Warc Blog

Gulf adspend set for growth

11 December 2013
DUBAI: Growing confidence among international and domestic advertisers has helped to boost adspend projections for the Gulf region, although local analysts remain doubtful that this will translate into higher media rates.

As part of its latest forecast of global adspend, Publicis-owned ZenithOptimedia said it expected growth of 4.3% in the MENA region this year, Gulf News reported, rising to 7.3% in 2014.

This compared to its global estimate of 3.6% growth in 2013 and 5.3% next year. It was a much-improved regional figure compared to the previous two years, when adspend shrank 14.9% in 2011 following the political turmoil of the Arab Spring and grew by only a modest 1.4% in 2012.

ZenithOptimedia said earlier this year it detected an increase in confidence and activity from international and domestic advertisers, and the violence in Egypt did not derail this recovery.

Regional advertisers are expected to be buoyed by preparations for the Expo 2020 in Dubai with the world fair providing a focus for the industry over the next six years.

Whether this encouraging sign of increased confidence equates to higher media rates, however, is not being taken for granted by local industry insiders.

Zubair Seddiqi, managing director at UM Dubai, said: "Media inflation relies on various factors beyond mere sentiment; while bullish sentiment may help bolster confidence in the market, actual media inflation relies on overall macro- and micro-economic factors among many others."

He went on to say the rise of digital media "poses a huge challenge for traditional offerings in the long run", meaning an increase in rate cards across the board may be "counter-intuitive".

Satish Maya, CEO of BPG Maxus agreed he didn't expect any sharp rate increases in 2014, although outdoor advertising and radio are likely to see a "corrective" increase.

Data sourced from Gulf News; additional content by Warc staff

 
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