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Optimism high as CCTV ad slots are snapped up

By Yu Tianyu (China Daily)
Updated: 2009-11-19 07:34

Chinese entrepreneurs Wednesday sent a strong signal that they have put the global economic downturn behind them when they swarmed the China Central Television (CCTV) building to splurge tens of billions of yuan on the network's prime-time advertising slots for next year.

Optimism high as CCTV ad slots are snapped up

They were there as the national broadcast giant began its annual auction, raising bids totaling 10.97 billion yuan ($1.6 billion) in about 13 hours. This year's bids were the highest for 16 years, up 18.5 percent on last year's 9.26 billion yuan, said CCTV.

Sichuan-based alcohol maker, Langjiu Group, won Wednesday's first bid, committing 33 million yuan for the exclusive right to have its name associated with the top scorer list during next year's soccer World Cup in South Africa. Li Mingzheng, deputy general manager of Langjiu, said the company spent 400 million yuan in total.

Chinese milk giant Mengniu was also one of the day's big spenders, shelling out 204 million yuan.

Experts said the 2010 CCTV Prime Advertising Resource Bidding was an indicator of the health of the Chinese economy.

Xia Hongbo, director of CCTV's advertising department, said: "The auction is a sign of entrepreneurs' confidence toward next year's business in the country. They are optimistic."

Several CCTV celebrity presenters helped announce the results of the auction. Some said it was one of the most important economic stories of the year.

Xia said household products and construction materials were the fastest-growing sector of advertisers with total bids growing by 200 percent year-on-year.

Bids from the sellers of household electrical appliances grew by 80 percent and the auto industry spent 70 percent more than last year.

Xia said 50 international companies took part. They spent 28 percent more than they did in 2008.

Home appliance producer Midea paid 52 million yuan for a slot during the 2010 Chinese New Year countdown, which is part of CCTV's Spring Festival Gala Evening.

Companies that bid for airtime were mainly enterprises depending heavily on people's disposable income, such as home appliance firms, medical products sellers and the food and beverage sector, said Yao Jinyuan, chief economist with the National Bureau of Statistics.

Optimism high as CCTV ad slots are snapped up

Zha Wei, an industry insider and vice-president of FliMore Media, said: "As a national television network, CCTV has advantages in certain genres, for example coverage and credibility or authority, compared to local or provincial stations."

Zha added that CCTV had revamped its flagship news programs since June, which helped it gain popularity.

Li Guangdou, a branding expert, said the cost of CCTV advertisements increased 20 percent year-on-year.

While many entrepreneurs complained about the soaring prices, Zha said companies were still willing to pay because advertising slots with CCTV are relatively scarce.

Statistics from CSM Media Research show more than 72.8 million people watch CCTV programming each day - seven times the audience for NBC Nightly News, one of the highest-rated news programs in the US.

Some multinationals aggressively participated in the bidding. Industry analysts had predicted they would keep away because of the global economic downturn.

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