Chinese TV advertising prices 2010

Prices for advertising slots on Chinese TV released

Beijing, Nov. 2009:

The lates figures of the annual auction for primetime advertising slots in 2010 have been released.
All in all CCTV's airtime auction netted a record return of RMB 10.96 billion (US$1.4 billion), an 18.5 percent increase compared to 2009.

Example 1: advertising slot prime time (before CCTV daily evening news at 19:00 p.m.):

in 2010:
Price: RMB 47.2 million (US$9 million)
Winner: Zhongce Rubber (China's biggest state-owned tire maker, based in Hangzhou)

in 2009 (as comparison):
Price: RMB 43.3 million (US$6.3 million)
Winner: Juren Group, a nation-wide education group)


Example 2: TV commercial spots around the Spring Festival Gala and the Lantern Festival Gala (the 2 most watched TV shows on domestic Chinese TV, which usually attract the highest prices at the auction):

in 2010: not known {if you do, please leave a comment of contact us via ...}

in 2009:
Price: RMB 47.1 million (US$ 6.9 million)
Winner: Midea Group (one of China's leading manufacturer's of household appliances)

in 2008 (as comparison):
Price: RMB 42.4 million (US$ 6.2 million)
Winner: not unknown {if you do, please leave a comment of contact us via ...}

Annual price increases for TV ad space over recent years has averaged at about 17% (see Figure 1).

Income from CCTV's Primetime Ad Auctions, 2002-2010

Figure 1: Income from CCTV's primetime ad auctions, 2002-2010


Highest bidders
Companies from the food, beverage, alcohol, finance and insurance sectors dominated the auction (46.5%).
In 2007 Procter & Gamble, who was the highest bidder then, alone accounted for RMB 420 million (US$53 million) of the bidding cake. As for 2010 P&G did not want to release any such information.

Most popular shows
Apart from the annually recurring Spring Festival and Latern Festival events, the most popular advertising slots were commercial breaks before and within TV-shows around the 2010 FIFA soccer World Cup and the 2010 Vancouver Winter Olympics (CCTV acquired exclusive broadcasting rights for both events).
Bidding prices for ad slots around sporting events increased by almost 50 percent compared to 2009.
Most ads around sporting events will show sports goods, beer and home appliances.


Why this price increase
This year's price increase (one should note that last and previous years' increases were partly due to the selling of ad time during the Beijing 2008 Olympics) might be partly due to a ruling by the State Administration of Radio Film and Television (Sarft) regarding the length of commercial breaks has seen satellite channels increase their rate cards, which in turn has made CCTV's inventory more competitive (some satellite subscriptions increased from RMB 200 per year to more than RMB 2,000 per year.


The role of provincial channels
Provincial channels are increasingly competing with CCTV’s dominant CCTV-1 terrestrial channel for ad revenue. The growth rate of prices for CCTV advertising slots sold at an annual auctions has averaged 17% over recent years. As bidding prices are rising, agencies trun to regional satellite TV channels with high ratings, in particular Hunan Satellite TV. The cost of advertising on regional satellite TV channels is typically half the price of CCTV, depending on the channel.

Example 3: 30-second prime time TV spot in 2009 on different channels:

CCTV-1: RMB 234,000 (US$ 34,281)
Hunan TV: RMB 108,129 (US$ 15,840)
Anhui TV: RMB 75,200 (US$ 11,017)


(sources: China Daily, Nov. 2006; Zenith Media Nov. 2009; China Media Exchange, Nov. 2009)
 
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