TV’s Market Share of Global Adspend to Peak this Year

LONDON: ZenithOptimedia is forecasting that global ad spending will see the strongest sustained period of growth in ten years, with mobile technology leading the way and TV as the second largest contributor.

ZenithOptimedia predicts that global adspend growth will rise from 3.6 percent in 2013 to 5.3 percent in 2014, reaching $532 billion. Growth is then forecast to increase to 5.8 percent in 2015 and 2016. This assumes that the Eurozone's gradual recovery continues and that there is no new crisis.

Mobile is leading the way for adspend growth. This marks the first time in the last 20 years that a new platform is expanding overall media consumption without cannibalizing any of the other media platforms. ZenithOptimedia forecasts mobile to contribute 36 percent of all extra adspend between 2013 and 2016. Television is the second largest, accounting for 34 percent of new ad expenditure. Even with all its growth, mobile advertising still only accounted for 2.7 percent of global adspend in 2013; this is expected to increase to 7.7 percent.

Television’s share of global adspend has stabilized, after growing slowly but surely for most of the last three decades. Television accounted for 31 percent of spend in 1980, 32 percent in 1990, 36 percent in 2000 and 39 percent in 2010. ZenithOptimedia now expects television’s market share to peak in 2013 at 40.2 percent, before falling back marginally to 39.3 percent in 2016.

For its European ad forecast, ZenithOptimedia separated out Portugal, Ireland, Italy, Greece and Spain (PIIGS) into their own zone. Their ad markets have fallen sharply; estimates are that this zone fell by 11.1 percent in 2013. However, 2014 looks better for the PIIGS markets, with ad expenditure only forecast to shrink by 0.9 percent, followed by a slow recovery of 1.8-percent growth in 2015 and 2.5-percent growth in 2016.

For Northern and Central Europe, after 0.1-percent growth in 2013, forecasts are that ad expenditure will rise to 2.4 percent in 2014, 2.6 percent in 2015 and 2.8 percent in 2016.

In Eastern Europe and Central Asia, expectations are for growth of 11.7 percent by the end of 2013, followed by 8-percent to 10-percent growth for the rest of the forecast period.

As Japan behaves differently from other markets in Asia, it tends to be treated separately. Japan grew 2.1 percent in 2013, and growth is expected to remain at about 2 percent a year through to 2016. In Advanced Asia (Australia, New Zealand, Hong Kong, Singapore and South Korea), growth was just 1.3 percent for 2013. However, ZenithOptimedia forecasts a much healthier 4.5-percent growth in 2014, followed by 6.6-percent growth in 2015 and 4.8-percent in 2016. Fast-track Asia (China, India, Indonesia, Malaysia, Pakistan, the Philippines, Taiwan, Thailand and Vietnam) was relatively unaffected by the 2009 downturn and has been growing comfortably at double-digit rates. It is estimated that Fast-track Asia has grown 10.7 percent in 2013, and will grow 10 percent to 12 percent annually in 2014 to 2016.

Ad spending is more robust in North American than in Europe, according to ZenithOptimedia. In North America, adspend has grown 3.3 percent in 2013 and is forecast for a strong 4.6 percent in 2014, boosted by the Winter Olympics and mid-term elections, followed by 4.6-percent growth in 2015 and 4.1-percent in 2016.

Latin America has seen its ad market growing at a healthy rate, much like its economic output. After an estimated 8-percent growth this year, forecasts for annual growth are between 10 percent and 13 percent over the next three years.

After the start of the Arab Spring in December 2010, the ad markets in the Middle East and North Africa (MENA) were constrained. Adspend shrank 14.9 percent in 2011 and grew 1.4 percent in 2012. Forecasts are now for 4.7-percent growth in ad expenditure this year, going up to 7.3 percent in 2014 and drifting to about 3-percent annual growth in 2015 and 2016.