Japan Quake, Mideast Turmoil to Impact Ad Revenues

LONDON: ZenithOptimedia has revised its global ad-growth projections for this year from 4.6 percent to 4.2 percent following Japan’s devastating earthquake and tsunami and the political turmoil across the Middle East, which have knocked an estimated $2.4 billion from global adspend this year.

Egypt, the largest ad market to be hit by so-called "Arab Spring," saw almost no TV advertising during the uprising, ZenithOptimedia says, and advertisers have been cautious ever since. In Japan, meanwhile, commercial ad slots following the natural disaster were taken over by public-service announcements. These events, however, won’t have long-term impact on their ad markets, ZenithOptimedia indicates. Japan will rebound to a 4.6-percent growth next year following a 4.1-percent drop this year. And Egypt will partially recover from a 20-percent plummet this year with a 12.1-percent growth rate in 2012.

Meanwhile, ZenithOptimedia remains optimistic about the overall growth projections for the future, upping its 2012 forecast from 5.2 percent growth to 5.8 percent. By 2013, global ad spend will be $525.5 billion. Developing markets will continue to lead the charge, increasing their share of the global pie from 30.9 percent in 2010 to 35.1 percent in 2013. The U.S. will continue to be the largest ad market for the foreseeable future, with $151.5 billion in adspend rising to $165.9 billion in 2013, and Japan will remain in second place. By 2013, China will overtake Germany as the third-largest ad market, while Brazil will inch up to sixth place. Russia will enter the top ten list by 2013 with a spend of $14.7 billion. Developing markets will contribute 62 percent of new ad dollars over the next three years.

By region, North America’s ad spend will rise from $160.56 billion this year to $176.1 billion in 2013. Western Europe will grow from $105.4 billion to $116.9 billion. Asia Pac will rise from $107.9 billion to $130.5 billion. CEE will see strong gains, from $28.5 billion to $40.4 billion. Latin America will rise from $29.1 billion to $36.9 billion. Growth will be slower in the Middle East and Africa, increasing from $11.16 billion to $12.35 billion.

By medium, television will remain dominant, its share rising slightly from 40.4 percent in 2010 to 41.7 percent in 2013. In that time, the Internet will become the second most important ad medium, displacing newspapers, its share growing from 14.1 percent to 18.3 percent.