A Message for Journalists and Editors:
SMARTPHONE USERS INCREASES,
ADVERTISING SPENDING OF MOBILE PRODUCTS ARE SKYROCKETING
● Smartphone is Fantabulous in Multimedia and Entertainment
● Television Becomes the Main Platform for Smartphone Brands To Advertise
Jakarta, 18 April 2018 – In line with the increasing smartphone users in Indonesia market, advertising expenditure for mobile products has also skyrocketed. According to Nielsen Advertising Intelligence (Ad Intel), in 2017, of the total advertising spending of IDR146 Trillion, as much as IDR 3.2 trillion comes from mobile products.
Since 2016 smartphone ownership has increased significantly beyond feature phone ownership. Of the total 67% mobile device owners in 11 cities in Indonesia surveyed by Nielsen in 2017, smartphone owners have reached 44% while feature phone owners were only 26%. Compared to 2015, this number has increased significantly whereby the number of smartphone owners are fewer (34%) than feature phone owners (43%). Only 2.5% of mobile devices owners have both smartphones and feature phones at the same time, and this number tends to continue declining compared to 2016 (2.8%) and 2015 (3.9%).
Multimedia and Entertainment Features Are Smartphone’s Signature
The main drivers for consumers in buying smartphones are entertainment and multimedia features. This is shown by Nielsen data on factors that are considered by consumers when purchasing smartphones, i.e. (1) to Connect To Other People, (2) considered as Important and Urgent, (3) for Listening to Music, (4) Chatting and (5) To Update Information.
In terms of usage, in line the main reasons to buy a smartphone which are entertainment and multimedia features, smartphone owners are very fond of sending short messages (64%) using some of the most frequently accessed message apps such as WhatsApp, BBM, and Line. 59 percent love to interact in social media like Facebook, Instagram, Twitter and Path. Meanwhile, 48 percent of consumers use smartphones to listen to music or watch videos via Youtube, Joox, and Spotify.
"About 2 of 3 smartphone owners use their device to exchange messages through instant messaging applications and more than half of smartphone users (59%) are also connected to social media. So it is undeniable that smartphone owners are so used to have a constant connectivity with each other," said Hellen Katherina, Executive Director of Media, Nielsen Indonesia.
Advertising War of Smartphones on Television
Nielsen Ad Intel recorded that in 2017, mobile product advertising spend reached IDR3.2 Trillion, equals to 2% of the total advertising spend; and television is still the main option to advertise. Samsung was the highest spender for mobile phone category throughout 2017 with total advertising spend more than IDR1 Trillion, with a 95% advertising portion on television. Vivo followed with total advertising spend of IDR824 Billion, with 99% ad placement on television. The third largest advertiser is Oppo with a total advertising spend of IDR461 billion with a 96 percent share on television. In fourth place is Advan that actively advertise on television (98%) with total advertising expenditure IDR202 Billion; then Lenovo with a total advertising expenditure IDR154 Billion with 80% is on television advertisement.
The top three biggest mobile brand advertisers have their own strategies utilizing television to advertise. Samsung advertisement is dominant in Commercial Break (96%), while Vivo and Oppo utilized In-Program Ads, with ad portions of 66% and 85% respectively.
"In the midst of tight competition today, brands not only advertise on commercial breaks, but they have also utilized in-program ads to communicate their products. By doing advertising within the television program, they expect to reach more viewers, since most of TV viewers switch channels during commercial breaks. "said Hellen.
Vivo Grand Launch Excitement with Fantastic Figures of Advertising Spending
Vivo poured some huge amount of spending to promote several variants of its products such as Vivo V7+ and Vivo V9, by holding Grand Launch events that were aired live on national private television. In addition to utilizing the Commercial Break slot, Vivo also maximizes the use of In-Program Ads.
When launching Vivo V7+ in September 2017, Vivo spent IDR7.9 Billion in one day for TV Commercial Break slots, with live broadcasts on 9 television stations that successfully erached 16.7 million TV viewers. In addition to Commercial Break, Vivo also utilizes In-Program Ads in the form of On-Set Placement such as backdrop, product placement, build in and adlib by 48%; and On-Screen Placement (52%) such as squeeze frame, super impose, running text, digital embed, etc.
Six months later on March 29, 2018, Vivo launched Vivo V9 by doing a live broadcast on 12 TV stations. With total expenditure of IDR8,4 Billion in one day for TV commercial breaks, Vivo V9 Grand Launch was able to reach 14.7 million viewers. For In-Program Ads, Vivo V9 Grand Launch is utilized On-Set Placement (77%) more than On-Screen Placement which is only 23 percent.
ABOUT NIELSEN AD INTEL
Ad spending information is extracted from Ad Intel data is monitoring Indonesian advertising activity. In 2017, ad monitoring includes 15 national TV stations, 99 newspapers and 120 magazines and tabloids. Ad spending rate is based on gross rate card, without calculating discount, bonus, promo, package price, etc.
ABOUT NIELSEN CONSUMER AND MEDIA VIEW
CMV is a syndicated survey that is done to more than 17,000 respondents aged 10 years and above, in 11 main cities in Indonesia (Jakarta, Bandung, Jogjakarta, Semarang, Surakarta, Surabaya, Denpasar, Medan, Palembang, Makassar dan Banjarmasin). The information obtained includes data on demographic, psychographic, media usage and product use.
Nielsen Holdings plc (NYSE: NLSN) is a global measurement and data analytics company that provides the most complete and trusted view available of consumers and markets worldwide. Our approach marries proprietary Nielsen data with other data sources to help clients around the world understand what’s happening now, what’s happening next, and how to best act on this knowledge. For more than 90 years Nielsen has provided data and analytics based on scientific rigor and innovation, continually developing new ways to answer the most important questions facing the media, advertising, retail and fast-moving consumer goods industries. An S&P 500 company, Nielsen has operations in over 100 countries, covering more than 90% of the world’s population. For more information, visit www.nielsen.com.