Global Adspend To Grow 6.4% In 2008

China will become the fifth largest ad market in the world this year, overtaking Italy, says ZenithOptimedia. However, it will still be only two-thirds the size of the fourth largest – the UK – but at its current rate of growth (averaging 18% a year to the UK’s 5%) it won’t be long before it takes fourth place.

Zenith has upgraded its forecast for all other regions. It now expects Western Europe to outperform North America throughout 2007 to 2009, after nine years of underperformance.

It adds that it is encouraged by signs of recovery in Germany and the UK, saying that the UK’s television market appears to have reached the bottom of its trough in mid-2007 and should exhibit modest growth in the third quarter, though it will be flat at best for the full year.

The German ad market expanded by 4% in 2006 – the fastest growth since 2000, and its first growth at above the rate of inflation.

ZenithOptimedia also predicts the Olympic Games will attract $3 billion in additional ad expenditure in 2008, nearly $1 billion of it in China.

Global Advertising Expenditure By Medium
US$ Million, Current Prices (Currency conversion at 2006 exchange rates)
	2005	2006	2007	2008	2009
Newspapers	120,367	125,043	127,916	131,369	135,011
Magazines	52,722	54,616	56,397	58,618	61,152
Television	151,191	161,389	168,988	180,318	188,759
Radio	34,225	35,225	36,283	37,461	39,064
Cinema	1,717	1,794	1,908	2,096	2,320
Outdoor	21,944	23,948	25,685	27,615	29,718
Internet	19,419	26,031	33,465	41,197	47,436
Total*	401,585	428,047	450,642	478,673	503,460
Source: ZenithOptimedia
*The totals here are lower than the totals in the ‘Advertising expenditure by region’ table above, since that table includes total adspend figures for a few countries for which spend is not itemised by medium

Share Of Total Adspend By Medium 2005-2009 (%)
	2005	2006	2007	2008	2009
Newspapers	30	29.2	28.4	27.4	26.8
Magazines	13.1	12.8	12.5	12.2	12.1
Television	37.6	37.7	37.5	37.7	37.5
Radio	8.5	8.2	8.1	7.8	7.8
Cinema	0.4	0.4	0.4	0.4	0.5
Outdoor	5.5	5.6	5.7	5.8	5.9
Internet	4.8	6.1	7.4	8.6	9.4

All of the fastest growing markets are in the Middle East and Central & Eastern Europe. Media Markets in both regions are maturing rapidly, and advertising is playing a growing role in local economies.

Zenith adds that it has upgraded its internet advertising forecast once again, in light of strong growth in video ads and local search, and now expects the internet to attract 8.6% of global adspend in 2008 and 9.4% in 2009.

It predicts that online adspend will grow by 82% between 2006 and 2009, whilst the rest of the ad market grows by 13%.

Advertising Expenditure By Region
Major Media (Newspapers, magazines, television, radio, cinema, outdoor, internet) US $ Million, current prices (Currency conversion at 2006 average rates)
	2005	2006	2007	2008	2009
North America	173,306	182,542	188,867	196,658	202,809
Western Europe	99,130	103,767	108,098	112,893	117,877
Asia Pacific	88,258	93,905	99,867	108,288	114,334
Central & Eastern Europe	19,424	22,875	26,739	31,133	35,998
Latin America	17,819	20,058	21,345	22,826	24,242
Africa/M. East/ROW	10,508	12,848	14,853	17,524	20,707
World	408,443	435,995	459,767	489,321	515,965
Source: ZenithOptimedia

A recent forecast from Carat said that global adspend will grow 5.8% this year, fractionally down from last year’s 5.9% (see Global Adspend Forecast To Grow 5.8%).

Meanwhile, Universal McCann lowered its 2007 US advertising forecast to 3.1% and also forecast overseas ad growth of 4.2% (see Universal McCann Lowers 2007 US Ad Forecast).