NEW YORK/LONDON: Next year global advertising expenditure will finally surpass the peak seen before the global financial crisis, although this recovery is patchy with some markets remaining well below the 2007 level, a new study has said.
In its This Year, Next Year
report, GroupM, the media management investment operation of WPP, forecast that global adspend would increase 4.5% in 2014 to reach $534bn, and 5.0% in 2015 to hit $560bn.
This progress is not spread evenly, however, as just 17 markets will account for 93% of expected ad growth this year. The US leads the way with an expected additional $162bn of spending, followed by China, adding $76bn. Other countries contributing include Nigeria, Kenya and Vietnam.
Of China, report editor Adam Smith observed that the consumer economy was continuing to grow
. "This, plus intensive digitisation of advertising, keeps China ad investment rising at or near double-digits, with no large print legacy to correct," he said.
The Western Europe outlook, however, was less bright. In the eurozone area, which accounts for 73% of the regional economy, adspend was still 20% below the 2007 peak; amongst those countries hardest hit by the crisis – Greece, Ireland, Spain, Italy and Portugal – it was 47% below the peak.
The report noted that Western Europe also had the world's most print-heavy advertising, although the downward trajectory of adspend in this medium was slowing from double digits to single digits.
And, according to Smith, Western Europe is also the most-digitised ad region in the world, "though this may finally be maturing to judge by digital ad investment growth slowing from double- to high-single digits in 2014 and 2015".
In Asia, GroupM warned that the political and economic challenges being faced in several countries – and it highlighted Indonesia, Malaysia, Thailand, Philippines, Singapore and Vietnam – meant that ad growth in the Southeast Asia region would slip from double-digit growth to mid-single.
The fastest-growing markets were expected to include India, Brazil and Russia, although GroupM warned that its Russia forecast – already reduced from 10% to 6% – was dependent on the situation in Ukraine remaining stable.
Data sourced from GroupM; additional content by Warc staff