Adspend set to rise in Middle East

11 February 2010

DUBAI: Advertising expenditure levels in the Middle East and North Africa will continue to rise over the next four years, a forecast covering 15 markets in the region has predicted.

The Dubai Press Club, the industry body, and Value Partners, the consultancy, recently released a study covering countries including Egypt, Jordan, Qatar, Saudi Arabia and the UAE.

Revenues across all of the nations assessed declined by 14% in 2009, to $4.6 billion (€3.3bn; £2.9bn), but will improve to $5.1bn in 2010, and $5.6bn in 2011.

Looking further ahead, combined expenditure across these 15 nations will register a compound annual growth rate of 8.4% from 2010 to 2013, reaching a value of $6.3bn by the latter date.

More specifically, the UAE, the region's biggest ad market, and Qatar will both enjoy upticks of 11% a year, a figure that falls to 7% for Egypt.

On a regional basis, TV will be the main driver of this expansion, while press ad sales will climb to $4bn this year from $3.6bn over the previous 12 months.

While the web currently takes a 1% share of all advertising outlay in these markets, totalling $56m, it should see growth of 4.5% a year, to $266m, by 2013.

One major contributor to this trend will be the rapid increase of broadband penetration, which is predicted to double over the forecast period.

Total media budgets will return to the same level as before the onset of the financial crisis by 2011, the DPC–Value Partners report said.

At present, however, average per capita adspend in this area stands at just $22, compared with $30 in Asia Pacific, $273 in Western Europe, and $462 in North America.

Maryam bin Fahad, executive director of the Dubai Press Club, said "following the negative impact of the global crisis in 2009, the Arab World is expected to quickly resume its position as one of the fastest- growing regions in the world."

"As the quality and quantity of locally-produced content improves, both consumers and industry players will start to see substantial benefits."

"Furthermore, driven by the younger generations, new platforms such as internet and mobile phones are increasingly accessible and becoming powerful platforms for advertising."

Data sourced from Emirates Business 247, Maktoob Business, The National; additional content by Warc staff