ZenithOptimedia: World Cup to Lift Global Ad Market by $1.5 Billion

PARIS: The World Cup is expected to help boost the global ad market by 5.4 percent this year, according to the latest estimates from ZenithOptimedia, which forecasts continued improvements over the next two years.

ZenithOptimedia’s new Advertising Expenditure Forecasts sees growth of 5.7 percent in 2015 and 6.1 percent in 2016, led by the continued economic recovery, including in the Eurozone.

The World Cup is predicted to boost global ad spending by $1.5 billion in 2014, as it drives large TV audiences and high interest in news media and sports websites during a time of year when people normally spend less time consuming media. Television is expected to benefit the most from the World Cup, though advertisers are spending more of their budgets on Internet advertising around the event. The World Cup is set to have the biggest impact on the ad market in Latin America. ZenithOptimedia predicts that the World Cup will add as much as $500 million to the Latin American ad market this year. Despite the lower levels of interest in football in North America, the firm expects the Cup to add an extra $300 million to the region. It also expects an extra $300 million in Western Europe. The disadvantageous time differences in the Asia Pacific, however, will see a lower level of additional spend in the region, at $250 million. The remaining $150 million is set to come from Central and Eastern Europe, the Middle East and North Africa, and the rest of the world.

Western Europe is forecast to see a 2.2 percent rise in ad spending this year, up from the previous forecast of 1.7 percent. This is thanks to a stronger than expected recovery in Sweden and continued improvement in the U.K., which was the fastest growing market in Western Europe in 2013. ZenithOptimedia predicts that U.K. ad spending will grow 7.4 percent this year, up from the 5.8 percent that was previously predicted. The forecast for the Eurozone is 0.8 percent for 2014, up just slightly from the previous forecast of 0.7 percent. The firm is optimistic about the growth prospects for the future of the Eurozone though, predicting a rise of 1.9 percent in 2015 and 2.2 percent in 2016.

The conflict in Ukraine has resulted in advertisers reducing their spending in the market. ZenithOptimedia now predicts that the ad market in the country will shrink this year by 32.5 percent. The Russian economy has taken a hit from sanctions imposed by the U.S. and the E.U., leading to a downgraded forecast for Russia from 9 percent to 6.9 percent for 2014. The overall forecast for Central and Eastern Europe is down from 6.9 percent to 4.2 percent.

TV advertising is still growing healthily, but it is losing market share to brand building on the Internet. Even with the boost from the World Cup, global ad spending on TV is forecast to start declining this year, after peaking in 2013. Television's global market share had been rising steadily for decades, but its share of the total ad market is expected to erode to 39.4 percent in 2014 and 38.3 percent in 2016. TV ad spending is still set to rise an average of 4.4 percent a year to 2016, but Internet advertising is growing much faster, at 16.2 percent a year.

Steve King, ZenithOptimedia’s worldwide CEO, said: “The World Cup is a great opportunity for advertisers to reach passionate and involved audiences worldwide. While television will remain central to how fans experience the competition, advertisers are using digital media more than ever before to help shape this experience. Over the next few years internet advertising will play an even greater role in supplementing the brand‐building power of television.”