Magna sees election adspend boost

02 May 2012

NEW YORK: US adspend will rise by +4.0% in 2012 due to the effects of the Olympic Games and presidential election, latest MagnaGlobal forecasts show.

The research firm's latest US Advertising Forecast also slightly revised its growth estimate for 2011 to +3.1%, slightly up from the +2.9% annual growth it forecast in January 2012.

But when the positive effects of the presidential election and Olympic Games are removed, the forecast for 2012 is for all-media expansion of just +2.2%, representing a slowdown from last year.

Magna said that macro-economic factors, with the US still enduring a "tepid" recovery from the 2008–09 downturn, were the major factors depressing growth.

In all, Magna forecasts that the prolonged political campaigning surrounding the election will benefit media spend by around $2.5bn this year.

Local TV stations will be particular beneficiaries, with adspend on these channels up +10.4% year on year, compared to +0.8% without political or Olympic dollars. Spend on national TV, another traditional venue for political ads, is set to increase by 3.9%.

Internet is predicted to record the most rapid growth, up +12.2% from 2011, including a +53.1% rise for mobile. As a whole, online adspend will reach $35.6bn, a 20.2% share of the all-media total.

Vincent Letang, head of global forecasting at Magna, said: "Mainstream advertisers are now fully embracing all mobile formats ... iAd and Facebook in particular will create more opportunities for marketers in various mobile environments in 2012."

On the other side of the ledger, traditional media are expected to lose further market share in the US this year.

Print media are predicted to suffer the worst declines, with newspaper advertising down -6% and magazines down by 3.8%. Direct marketing and radio are also set to drop from 2011's totals, down -2.4% and -0.8% respectively.

Data sourced from MagnaGlobal; additional content by Warc staff