About this Blog

The purpose of this blog is for my personal use. It serves as my personal diary as I investigate Chinese internet/gaming companies for investment purpose. If you have any comments or disagreement, please give me feedbacks.

Thursday, April 30, 2009

China's Internet Advertising Market Survey by Nielsen

You can find my previous article on the survey of China's Internet advertising market here:

http://chinese-net-gaming-stock.blogspot.com/2009/04/1q2009-internet-advertising-month-to.html


I guess it that time of the season where all the survey shops come out with their survey result for the 1st quarter. Nielsen and ChinaRank jointly conducted the survey for China's Internet Advertising Market. One can find the article below:

http://tech.sina.com.cn/i/2009-04-28/18093046575.shtml


I like this survey because it breaks out the month by month survey results. It can clearly show the trend. For March 2009, China's Internet Advertising market has revenue of $1.14B. That number is an increase of 61.6% year over year (YoY).


The following plot has the revenue by month from January 2008 to March 2009:

I will tabulate the data below:

Month

2/08

3/08

4/08

5/08

6/08

7/08

8/08

9/08

10/08

11/08

12/08

1/09

2/09

3/09

Revenue

.6

.78

1.02

.96

1.18

1.14

1.22

1.36

1.14

1.24

1.73

.85

.71

1.14

YoY












2.4%

18%

46%


It is a little hard to believe the survey result for December 2008. I think that was too strong. But still, it is clear that there is a very drastic decline from 4Q2008 to 1Q2009. Within the three months of the 1Q2009, February 2009 was so weak you have to go all the way to a year ago to find one weaker. In addition, the data also showed that there is a very strong pick up in March 2009. There is an amazing 61% pick up from February 2009 to March 2009.


This survey results pretty much confirmed the other three surveys conducted by three other survey houses. We are probably going to see pretty nasty 1st quarter results.

On the other hand, even though it is still too early to tell, but tt will probably follows by a very strong V-shaped pick up in the 2nd quarter.


Addendum: Somebody mentioned that I interpreted the data incorrectly. The weakness of the 1st quarter was due to seasonality factor (i.e. Chinese New Years). Note that Chinese New Years occurs in February in 2008 and January in 2009. The logical conclusion shall be that the weakest one shall be on January 2009 because of Chinese New Year. But that is not the case.


He has a point. Seasonality has more of an effect than general economic conditions. If we use the year over year comparison, we will have an increase of +2.4% in January 2009, +18% in February 2009, and 46% in March 2009. I don't have the year over year number for the 4th quarter 2008. Therefore, it is possible that February 2009 is not the lowest point. It is possible that the lowest point was some month in the 4th quarter 2008.


Personally I still think February 2009 is the lowest point. But I don't have enough data to verify that.


But regardless whether the low point is on 4Q2008 or February 2009, what is not debated is that the March survey result indicated the start of an acceleration of revenue growth.



1 comment:

JONES WILSON said...

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