Magna forecasts 3.1% increase for US ad revenues

MagnaGlobal’s latest US media advertising report forecasts steady growth with soft underpinnings in 2011, with revenues growing by 3.1%, excluding the impact of political and Olympic advertising.

Total advertising levels remain below those observed in 2003, with the industry likely to achieve revenues of $173 billion this year.

However, with the impact of political and Olympic advertising, total ad revenues will only grow by 1.9% during 2011, lower than the 4.3% expected for 2010, Magna said.

Total revenues are lower due to a “structural weakness” in print media, which has suffered on-going declines. Magna predicts that newspapers, magazines, directories and direct mail will witness a 2.9% decrease during 2011.

By contrast, digital and broadcast media continues to grow at a rapid pace, as does out of home. Digital, TV, radio and outdoor are expected to enjoy growth of 6.9% this year (collectively).

However, the biggest winner will be mobile advertising, which is forecast to grow by a significant 60.1% during 2011. Online video has also achieved “meaningful scale” and should see a 26.8% rise this year.

Emerging outdoor media will also outpace the rest of the outdoor industry as inventory is increasingly monetised, according to Magna, which predicts a 17.4% upturn for the sub-sector.

Alongside these trends, Magna expects traditional TV and older forms of digital media to continue to grow rapidly. TV advertising will rise by 6.3% in 2011, while digital display will grow by 11.6%. Paid search will also fare well, enjoying an increase of 11.1% over the year.