Global Adspend to Grow 4.4 Percent in 2015, Online Video Leading the Charge

LONDON: Global adspend is expected to grow 4.4 percent to reach $544 billion in 2015, according to ZenithOptimedia’s new Advertising Expenditure Forecasts, which finds that the fastest growing advertising category is online video.

Growth is forecast to accelerate to 5.3 percent in 2016, boosted by the 2016 Summer Olympics in Rio and the U.S. Presidential elections. Adspend will then slow down slightly in the absence of these events, growing 4.8 percent in 2017.

Thanks to the explosion of mobile video consumption and the spread of internet‐connected devices, such as smart TVs and game consoles, online video is the fastest growing ad segment. Several other factors are contributing to online video growth: measurement agencies are investing in research to track consumers’ exposure to video ads across desktop computers, tablets and television screens; the main social media platforms are all developing their video products; and more online video is being sold by programmatic buying, providing advertisers with more control and better value. ZenithOptimedia estimates that global online video grew 34 percent to $10.9 billion in 2014, and forecasts it to grow at an average of 29 percent a year to reach $23.3 billion in 2017.

With an eye on Eastern Europe, ZenithOptimedia forecasts adspend in Ukraine to shrink 62.3 percent this year, on top of a 51.2 percent decline in 2014. Russian adspend grew just 4.3 percent in 2014, which was the first year of growth below double‐digit rates since 2009, and the report predicts the market will shrink by 16.5 percent in 2015. ZenithOptimedia forecasts a 33.5 percent decline in adspend in Belarus this year, following 7.6 percent growth in 2014. Between them, these three markets account for 2.1 percent of global adspend, so their sudden decline has slowed but not derailed global adspend growth.

China’s ad market is slowing in step with its economy. Forecasts are that Chinese adspend will grow 9.1 percent this year, below the 10.5 percent annual growth it averaged over the past five years, but more than twice the rate of the world as a whole. Between 2014 and 2017, we expect the Chinese ad market to enjoy an average growth rate of 8.5 percent a year.

After shrinking 5.2 percent in 2012 and 2.5 percent in 2013, adspend in the Eurozone increased 1.5 percent in 2014. ZenithOptimedia expects growth to continue to improve, though very gradually, from 1.6 percent in 2015 to 1.9 percent in 2017.

Steve King, ZenithOptimedia’s CEO, Worldwide, said: “Online video combines the emotional connection of television with the efficient targeting and measurable effectiveness of digital display. While television will remain dominant for many years to come, advertisers are increasingly utilizing online video as an invaluable complement, giving them new opportunities to communicate brand values to consumers.”