Ad Forecasts on the Rise

LONDON/NEW YORK: ZenithOptimedia, MagnaGlobal and GroupM have released positive advertising forecasts for 2011, with all three adjusting earlier expectations upward and predicting that global ad growth will continue.

Media buyer ZenithOptimedia estimates that global ad expenditure will have grown 4.9 percent by the end of 2010. An annual growth of between 4.6 percent and 5.2 percent is expected for the next three years. Developing markets are predicted to continue growing at a much faster rate than developed markets. Between 2010 and 2013, ZenithOptimedia forecasts Japan to grow by 5 percent, North America to grow by 9 percent and Western Europe to grow by 10 percent. Latin America is expected to grow by 26 percent, Central and Eastern Europe by 31 percent, Asia Pacific by 23 percent, and Asia Pacific excluding Japan to grow by 36 percent. The rest of the world—primarily the Middle East and Africa—will grow by 24 percent. Developing markets, which were defined as everywhere outside North America, Western Europe and Japan, will increase their share of the global ad market from 31.5 percent in 2010 to 35.9 percent in 2013.

MagnaGlobal, which tracks ad sales not spending, forecasts global ad revenue to grow by 5.4 percent to reach $412 billion in 2011. Television is said to remain as the top advertising medium, accounting for $169 billion in 2011, but online advertising is predicted to overtake newspapers as the world’s second-largest ad medium by 2013. MagnaGlobal’s expectation for the compounded annual growth rate for the global advertising industry is 6.3 percent through 2016. Internet ad revenue may reach $117 billion by 2016, according to Magna’s report.

GroupM said global ad spend in measured media will exceed $500 billion for the first time ever next year, according to its revised report. The new data also supported MagnaGlobal’s predictions that digital media outlets will fall just behind television in advertising investment, ahead of newspapers. The forecast predicts that worldwide ad spending will see a 5.8-percent increase in 2011 over this year’s spending of $474 billion. In the U.S. 2011 spending is expected to hit $147.7 billion, a 3.7-percent increase over the $142.5 billion invested in 2010. The 2010 ad spending is expected to increase 5.9 percent over the $448 billion spent in 2009; in the U.S., 2010 spending increased 1.2 percent over 2009, when almost $141 billion in ad expenditures was reported.