Zenith UK advertising revenue predictions by medium

ZenithOptimedia has amended its detailed UK advertising forecasts, and now expects growth of 4.5% to £11.3bn in 2010, then to £11.6bn and to £12bn in 2011 and 2012 respectively (2.5% and 4%).

It is a much rosier picture than the one Zenith painted back in April at 1.3% growth or December 2009 when it suggested a likely fall of 2%.

The changing picture sees improvements across all media, compared with predictions early this year.

In TV, Zenith describes the market as remaining “extremely buoyant” with growth driven by retail and food principally and with both the finance and motor sectors returning gradually. Spend was up 15% in the first half of 2010 and is expected to rise 10.5% yoy in the second half, giving 11.4% over the whole year, just below 2008’s total. Looking forward, Zenith expects 3% growth for each of the next two years.

Radio has been hit by a sharp reduction in the COI’s budget since a strong Q1, but comparative numbers should look better from Q2 2011 after the COI comes back into the market, and Zenith forecasts growth of 3% and 2.9% in 2011 and 2012, and comments on increased radio listening and Global’s consolidation of stations too, which offers “more efficient sales.”

In the press arena, Zenith points to a market in “rude health” according to NMR’s ratecard figures for ad expenditure – total market up 6% for the first 8 months, nationals up 9.5%. However given the COI’s spend has fallen by 40% to date in press and “signs that supermarket spending is stagnating,” there are some “dark clouds on the horizon,”leading to a forecast of less than 1% growth for magazines in each of the next two years and falls of just over 1% for newspapers.

“The one ray of light is the very ‘long tail’ of advertisers evident in both national press and consumer magazines. They represent 25% and 50% of all ad revenues respectively, and they are yet to return to growth. If they were to do so, then this would offset most of the shortfall caused by the supermarkets and COI.”

Regional newspapers are expected to continue to fall from nearly £2bn in 2008 to under £1.3bn by 2012, but with the level of decline yony slowing down in 2011 and 2012.

Zenith’s figures for the internet include forecasts for Facebook and YouTube who do not report revenues via the IAB. Forecast growth then is at 6.9% this year, 5.9% next and 10.1% in 2012, with search’s percentage growth still outpacing display comfortably. Display is put at £751m by 2012.

Zenith predicts Outdoor growth will be 10.2% for this full year, slowing considerably to 2% next year and growing by 5% in Olympic year.

Cinema is forecast to grow modestly year on year from £164m in 2009 to £177m in 2012.