Global adspend to rise by 3.8% in 2010

18 August 2010

LONDON/WASHINGTON: Global adspend will increase by 3.8% in 2010 as the economic outlook improves in most major markets, according to the latest Warc Consensus Forecast.

Based on a weighted average of recent predictions from agencies, media companies and industry bodies, it is estimated that worldwide ad expenditure should rise by a further 4.3% in 2011.

This can be measured against respective figures of 2.8% and 3.8% in April's Forecast, as stronger corporate and consumer confidence stimulates a heightened interest in marketing after sharp cuts in 2009.

Highly flattering comparisons and hardening sentiment mean the advertising recession will only endure in Spain and Japan in 2010 among the 13 countries featured in the analysis.

China, India and Russia are due to register an expansion of more than 10% each this year and next, with Brazil, Australia and Canada comprising the second tier of nations in terms of annual growth.

Improving conditions in France, Germany, Italy and the UK indicate the renewed resilience of Western Europe, and the US is in line for successive upticks of 1.7% and 2.7% in the assessment period.

By medium, television revenues will increase by 12.3% in China in 2010, rising to 13.5% in 2011, while totals are also expected to jump by 15.3% and 16.3% in India, and 15% and 18.6% in Russia.

Expenditure levels through this channel are set to rise by 7.1% in the UK and by 6.1% in the US this year, with this acceleration moderating to over 2% in both countries in the following 12 months.

In contrast, broadcasters in Japan and Spain could face modest declines in 2010 before the sector returns to profitability in 2011.

A significantly more challenging climate awaits newspapers, as sales remain flat or contract in established markets.

Prospects appear to be least favourable in the US as demand is pegged to fall by 10.3% in 2010 and 5% in 2011, while France, Germany, Italy, Japan, Spain and the UK may also all deliver consecutive drops in income.

Elsewhere, the revenues generated by press titles ought to rise by over 4% annually in Brazil, by around 7% a year in China, and achieve double-digit growth in India and Russia.

Magazine advertising is anticipated to replicate this trend, although the decrease in developed economies will be less severe and the expansion in the BRICs should outpace that for newspapers.

Online is likely to enjoy the most substantial improvement, posting positive figures in every country in 2010 and 2011.

Within this, brand owners in Brazil could boost their online outlay by a minimum 20% annually, reaching approximately 28% in Russia and over 30% in India.

After a surge of 28.7% in China this year, the web is expected to record an increase of 38.5% next year, in line with enhanced penetration and digital literacy.

Growth rates may prove slowest in the UK, up by 6.6% and 5.2% respectively, largely because the internet has secured an unparalleled level of maturity to date.

Warc's Consensus Forecast contains predictions for the major media spending in each of the 13 markets assessed. A free topline summary, in PowerPoint, is available here.

Warc subscribers can access a more detailed PowerPoint presentation containing predictions for the major media spending in each of the markets assessed here.

Data sourced from Warc