ZenithOptimedia has upgraded its predictions for the advertising industry over the next three years, forecasting underlying growth to remain solid, despite the market slowing in 2005 after the sporting events and elections seen in 2004.
Global advertising expenditure is estimated to enjoy growth of 5.4% in 2005, up from previous estimates of 5.0%, while 2006 is expected to rise up 6.5%, compared to ZenithOptimedia’s earlier forecast of 5.8%. Estimations for adspend growth in 2007 are not as optimistic, at 6.1%, revised upwards from 5.8%.
Europe is the only region that ZenithOptimedia has downgraded slightly, by 0.1 of a percentage point in 2005 and 0.2 of a point on 2006, principally because of continuing weakness in Germany.
Advertising is shown to be growing as a proportion of world GDP for the first time since 2000, contributing to 0.99% 0f the world’s economic output, up from 0.98% in 2003. ZenithOptimedia predict advertising’s contribution to continue to growth over the next three years, despite a slight deceleration in 2005.
ZenithOptimedia forecast television’s share of the advertising market to peak in 2006, falling slightly from 37.9% in 2006 to 37.8% in 2007 as advertisers divert more and more of their budgets to the internet.
The internet was revealed to have attracted 3.6% of total adspend in 2004, up from 3.2% in 2003. It enjoyed a 5.4% share in the United States and a 7.7% share in Sweden, with share still growing in both countries.
ZenithOptimedia show the internet as the fastest growing medium, with adspend growing by 21% in 2004 and predicted to grow in double digits in each of the years forecast. However, the internet is by no means the sole driving force of growth, with the traditional media pulling their weight as well.
Adspend in the traditional media, excluding the internet grew by 7.0% in 2004, with ZenithOptimedia predicting it to grow 5.1% in 2005, 6.2% in 2006 and 5.7% in 2007.
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