Malaysia’s Ad Spend Faces Digital Doldrums: Traditional Platforms Seek Resurgence

By The Malketeer

YouTube Sees Massive 32% Drop as Influencers and WhatsApp Steal Ad Dollars

The advertising landscape in Malaysia took a sharp downturn in 2024, with ad expenditure (adex) hitting RM6.1 billion, down 7.1% year-on-year (YoY).

This marked a significant deviation from Kenanga Research’s projected 1.6% YoY growth.

The decline paints a stark picture of the challenges plaguing both digital and traditional media platforms in a rapidly evolving marketplace.

Year-End Festivities Fail to Deliver

The anticipated seasonal boost from year-end festivities such as Christmas, New Year’s Eve, and the school holidays fell short of expectations.

Instead of a rally, advertising budgets saw a pullback as many companies deferred campaigns to align with the earlier Chinese New Year in 2025, slated for January 29.

This shift resulted in a steep drop in Q4 adex contributions, from 29% in 2023 to a mere 23% in 2024.

Digital Media’s Decline: A 33% Wake-Up Call

The digital media segment bore the brunt, suffering a 33% year-to-date (YTD) dip.

Platforms like YouTube saw adex fall by 32%, with competition from key opinion leaders (KOLs), social media, and web messaging apps eroding their share.

Similarly, online websites struggled, with Malaysia Kini and STAR experiencing drastic declines of 69% and 57%, respectively.

The lone bright spot was paultan.org, which recorded a 28% surge, buoyed by strong automotive industry volumes and increased car launches.

Traditional Media: Mixed Fortunes

Traditional media platforms faced contrasting trends.

Newspaper adex continued its decline, particularly among Chinese-language publications, while Free-to-Air (FTA) TV showed resilience, growing 2.3% YoY.

Channels like TV3 benefited from strong vernacular content that resonated with lower-income households.

Meanwhile, radio experienced a modest 2% YoY growth, with refreshed lineups on stations like FlyFM and HotFM reigniting listener interest.

Why Are Advertisers Moving Away?

The shift away from traditional and even some digital platforms highlights a broader transformation in advertising strategies.

Advertisers are increasingly leaning towards:

  1. KOL Collaborations: Direct partnerships and sponsorships with influencers who offer higher engagement rates.
  2. Web Messaging Platforms: Subscriptions like WhatsApp Business and Telegram sponsored messages are gaining traction.

These platforms cater to Malaysians’ growing preference for video content, with social media video watch time exceeding the global average by 55%.

Notably, 75% of Malaysian online shoppers rely on influencer recommendations, according to Shopee.

Challenges for Legacy Media

Traditional media’s struggle is compounded by steep operational costs, including high newsprint and broadcasting expenses.

An aging workforce with skills misaligned to the digital age further hampers agility, making it tough to compete with leaner, more flexible new media players.

Can Traditional Media Reinvent Itself?

Kenanga Research suggests that the sector’s future hinges on its ability to diversify into synergistic businesses or expand into new media.

Success here could serve as a much-needed catalyst, driving earnings growth and restoring relevance.

For now, the outlook remains cautious.

While some spillover adex is anticipated in early 2025, a contraction of 2.8% YoY is expected, driven by further declines in digital media, newspapers, and cinema.

Only FTA TV and radio are projected to post modest gains.

A Turning Point for Advertisers

The 2024 adex slump underscores a critical juncture for the advertising industry.

Traditional platforms must innovate and adapt to stay relevant, while advertisers need to rethink strategies to align with shifting consumer behaviours.

Whether this marks the beginning of a sustained downturn or a turning point towards reinvention remains to be seen.


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