PARIS: Global adspend will decline by 8.5% this year, to $456 billion (€327bn; £282m), while China is set to become the fourth most valuable ad market worldwide as it continues to enjoy growth, ZenithOptimedia says.
Earlier this year, the media network, part of Publicis Groupe, predicted ad revenues would shrink by 6.9% worldwide in 2009, having forecast an annual drop of just 0.2% as late as December last year.
America, the world's biggest ad market, will post a decrease of 10.3% this year, slowing to a contraction of 2.4% in 2010, the company forecasts.
By contrast, revenue levels in China will grow by 5.4% in 2009, meaning that the country will leapfrog the UK – where spending will fall by 10.5% – to become the world's fourth-biggest ad market.
Despite both seeing slowdowns, Germany and Japan will still stand between the world's most populous nation and the US in terms of total advertising expenditure.
India is also likely to register an increase in revenue levels of 7.7% this year, while Latin America will be static in 2009, before an expansion of 7.5% in 2010.
Globally, online adspend will grow by 10.1% in 2009, as the medium's "familiar virtues of transparency, accountability and flexibility have proved even more attractive in a recession than ever."
It will be boosted by a 20% uptick in paid-for search adspend in the US, with "traditional display" up 3% in the country, and classified by just 1.8%, on an annual basis.
The web will also take a 15.1% share of total ad revenues by 2011, up from 10.5% in 2008, with paid search the main driver of expansion.
By contrast, newspaper advertising will contract by 14.7% this year, while magazine ad sales are likely to fall even further as luxury brands pair back their spending levels.
Overall, Zenith argues that in light of "extreme uncertainty" in the marketplace, "advertisers in most sectors planned for the worst and cut their costs in anticipation of steep drops in revenue."
However, it added that the climate improved in the second quarter of this year compared with the first, and "from now on year-on-year comparisons will start to get a lot easier."
Indeed, despite its negative forecast for 2009, the company states that the situation is becoming slightly more stable "as signs emerge that the downturn is approaching its lowest point."
Based on this analysis, it predicts that total adspend will increase by 1.6% next year, and growth of 4.3% in 2011.
Recently, GroupM, part of WPP Group, forecast that global adspend will decline by 5.5% this year.
Data sourced from Financial Times/Wall Street Journal/Daily Telegraph; additional content by WARC staff