Global Adspend Growth Forecast In Line With GDP
Global advertising expenditure is estimated to increase by 4.7% this year, bringing 2005 adspend growth in line with expected GDP growth, according to forecasts published today by media group ZenithOptimedia.
Advertising Expenditure by Major Media (US$ million, current prices) | |||||
2003 | 2004 | 2005 | 2006 | 2007 | |
North America | 158,616 | 168,197 | 174,547 | 184,309 | 192,628 |
Europe | 98,450 | 104,398 | 107,942 | 112,571 | 117,518 |
Asia/Pacific | 73,573 | 79,625 | 83,654 | 89,121 | 96,112 |
Latin America | 13,748 | 16,142 | 17,082 | 18,167 | 19,265 |
Africa/M.East/ROW | 14,473 | 17,667 | 20,759 | 24,271 | 27,866 |
World | 358,860 | 386,030 | 403,984 | 428,438 | 453,390 |
Source: ZenithOptimedia, July 2005 |
Year-On-Year Percentage Change | ||||||
Major Media (newspapers, magazines, television, radio, cinema, outdoor, internet) | ||||||
2003 v 02 | 2004 v 03 | 2005 v 04 | 2006 v 05 | 2007 v 06 | ||
North America | 1.9 | 6 | 3.8 | 5.6 | 4.5 | |
of which USA | 1.7 | 6 | 3.8 | 5.7 | 4.5 | |
Europe | 1.4 | 6 | 3.4 | 4.3 | 4.4 | |
Asia/Pacific | 5.0 | 8.2 | 5.1 | 6.5 | 7.8 | |
Latin America | 0.9 | 17.4 | 5.8 | 6.4 | 6 | |
Africa/Middle East | 19.3 | 22.1 | 17.5 | 16.9 | 14.8 | |
World | Â | 2.9 | 7.6 | 4.7 | 6.1 | 5.8 |
Source: ZenithOptimedia, July 2005 |
Internet Growth Upgraded
Zenith has revised US$3.6 billion out of traditional media for 2005, but has added US$1.2 billion to the internet. The agency’s new internet total for this year is up 8% to US$16.4 billion since April’s forecast and this upwards revision is expected to be sustained in 2006 and 2007.
Television Hits A Plateau
According to Zenith, television’s share of global advertising spend appears to be peaking at 38% and the agency has reduced the medium’s 2005 adspend by US$2.3 billion to US$148.2 billion. The majority of this downgrade occurs in the USA – where several big advertisers are reducing and redeploying TV budgets – and in Japan, where there is brittle consumer confidence and advertising migration to the internet.
In the UK, the sharp correction of prolonged above-trend retail spending has led to Zenith marking UK TV down US$229 million.
Television’s share is stable in most developed markets, although it looks to have peaked in both the USA (37% in 1996) and the UK (33% in 1999) – two of the largest and mature TV advertising markets.
Zenith suggests that TV may now be on the verge of a long newspaper-like decline. Newspapers took 40% of global advertising spend throughout the 1980s before declining to, and stablising at, 30% today.
Global Shares Of Display Advertising Revenue By Medium (%) | |||||
2003 | 2004 | 2005 | 2006 | 2007 | |
Newspapers | 30.6 | 30.2 | 30 | 29.8 | 29.4 |
Magazines | 14 | 13.5 | 13.5 | 13.4 | 13.4 |
Television | 36.9 | 37.5 | 37.3 | 37.4 | 37.4 |
Radio | 8.8 | 8.6 | 8.5 | 8.3 | 8.2 |
Cinema | 0.4 | 0.4 | 0.4 | 0.4 | 0.4 |
Outdoor | 5.4 | 5.4 | 5.4 | 5.4 | 5.5 |
Internet | 3.2 | 3.6 | 4.1 | 4.5 | 4.7 |
Source: ZenithOptimedia, July 2005 |