As political spending continues to fuel US advertising spending, Universal McCann, along with many other global analysts, is revising previous predictions upwards to reflect the momentum in the marketplace.
Bob Coen, director of forecasting of Universal McCann, says he now expects a 7.3% increase in advertising spending in the US this year, compared with a previous estimate of 6.9%, while he expects 2005 to grow by 6.5%.
The national advertising market is also expected to grow this year and as a result Cohen has revised his forecast to 8.3% from 7.4%, while local advertising estimates have been revised downwards from 6% to 5.5%.
Within the national advertising categories, the internet is expected to be the fastest growing medium and as a result the forecast has been revised from 10% to 20%. Cable networks, syndicated television and direct mail are also expected to perform well during 2004, however, forcasting for broadcast networks, national newspaper advertising and yellow pages have been reduced.
| Universal McCann’s Estimated US Growth Rates For Advertising |
| |
|
|
|
| |
2003 Actual |
2004 Est. 12/03 Forecast |
2004 Est. 06/04 Forecast |
| National |
4.8% |
7.4% |
8.3% |
| Local |
1.7% |
6.0% |
5.5% |
| Total |
3.6% |
6.9% |
7.3% |
| Nominal GDP |
4.8% |
5.8% |
6.8% |
| |
|
|
|
| Source: Universal McCann, Merrill Lynch Economics (for GDP forecasts) |
Worldwide, Mr Coen expects advertising growth to be up by 6% during 2004 and 5.9% during 2005, though may be slightly higher due to a weaker US dollar.
Coen says that in Europe; Germany, the UK and Spain are expected to accelerate, while France and Italy are projected to see a slow down. Meanwhile, Japan should see an acceleration in advertising growth, from 0.7% in 2003 to 1.5% in 2004.
In most developing countries, advertising spending is projected to be robust in 2004, notably in China, Indonesia, Russia and India.
Merrill Lynch recently raised its forecast of global advertising expenditure to 5.5% and US to 6.6% which brings it nominally in line with GDP (see Merrill Advertising Forecasts Aligned With GDP).
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