Coen Pulls Down 2003 Ad Forecasts
Universal McCann‘s head of advertising forecasting Robert Coen has slightly downgraded his US and global advertising growth predictions for 2003 in the latest edition of his Insider’s Report.
US Advertising Growth Forecasts | |||
2002A | 2003 Old | 2003 New | |
National | 2.6 | 5.3 | 5.2 |
Local | 2.2 | 4.5 | 3.5 |
Total | 2.4 | 5.0 | 4.6 |
Source: Universal McCann, June 2003 |
The overall reduction is principally a result of the local advertising growth downgrade. Recruitment classifieds have been weak and the pace of retail advertising has been slower than expected, according to Merrill Lynch. These factors have hit the local market more significantly than the national market.
Across the board, the second half is expected to be stronger than the first, with the completion of the war and an improving economy. Moving into 2004, the markets are set to firm up even more.
The predictions by national and local categories show around half of national sectors have been reduced, with some categories receiving an upgrade; internet spend is notable – raised from no growth in December’s report to 5.0% growth in these figures. In the local sector, every category bar other media has been reduced.
Nevertheless, Merrill Lynch analysts note that the revisions are pretty small given the substantial uncertainties at the beginning of the year. Coen’s adjustments are also in line with revisions made to the broker’s own forecasts earlier in the year (see Latest US And Global Ad Forecasts From Merrill Lynch), although he remains on the more optimistic side of the consensus.
US Advertising Growth Forecasts | |||
2002A | 2003 Old | 2003 New | |
National | |||
Four TV networks | 4.9 | 4.5 | 4.0 |
Spot TV | 18.4 | 2.0 | -1.0 |
Cable TV | 2.5 | 7.5 | 10.0 |
Syndication TV | -2.2 | 4.0 | 8.0 |
Radio | 12.2 | 5.0 | 4.2 |
Magazines | -0.9 | 5.5 | 7.0 |
Newspapers | 2.9 | 6.0 | 5.5 |
Direct mail | 3.0 | 7.0 | 6.5 |
Yellow pages | 0.0 | 5.5 | 1.5 |
Internet | -13.5 | 0.0 | 5.0 |
Other media | -0.4 | 5.5 | 3.8 |
Total | 2.6 | 5.3 | 5.2 |
Local | |||
Newspapers | -1.1 | 4.5 | 3.5 |
TV | 6.9 | 3.0 | 2.5 |
Radio | 4.0 | 5.5 | 4.0 |
Yellow pages | 1.6 | 3.5 | 1.5 |
Other media | 5.0 | 5.1 | 5.6 |
Total | 2.2 | 4.5 | 3.5 |
Source: Universal McCann, June 2003 |
Global predictions Internationally – that is to say, outside the US – Coen is forecasting growth of 4.0% this year and 4.5% in 2004. For the global advertising market, he predicts growth of 4.3% this year and 5.6% in 2004.
The UK is expected to rise by 3.5% this year, after just 0.4% growth in 2002 (for reference, the Advertising Association puts UK growth at 0.8% in 2002). Elsewhere in Europe, France’s growth is expected to retract from last year’s 3.4% to 3.0% in 2003. Similar declines are expected in Germany.
Worldwide Advertising Expenditure Forecasts | ||||||
US | Non-US | Global | ||||
$bn | % Change | $bn | % Change | $bn | % Change | |
2002 | 236.9 | 2.4 | 213.6 | 1.9 | 450.5 | 2.2 |
2003F | 247.7 | 4.6 | 222.1 | 4.0 | 469.8 | 4.3 |
2004F | 263.8 | 6.5 | 232.1 | 4.5 | 495.9 | 5.6 |
Source: Universal McCann, June 2003 |