Crystal ball time again in midtown Manhattan, where on Monday the 29th annual UBS Warburg Media Week Conference administered another dose of dolor to the battered ad industry.
Addressing the conference were two of the media world’s most respected seers, John Perris of Zenith Optimedia in London and the senior vp and forecasting director of Universal McCann, New York, Robert J Coen.
Perris’s ‘more of the same’ prognostications were covered in detail in yesterday’s issue [WAMN: 03-Dec-01], an outlook with which fellow pundit Coen did not disagree. Each again lowered their previous estimates for ad spending in key markets like Britain, France and Germany where advertisers have followed the budget-cutting trend set by US manufacturers earlier in the economic cycle.
But each also saw a glimmer at the end of the tunnel, the latter half of next year in Coen’s case: “The economy at the end of the year 2002 will certainly be a lot stronger than it is now,” he believed.
But the current year, he opined gnomically, “was tough for anybody in the ad industry”. Global adspend will slide from 2000’s record $463.9 billion, down 1.7% year-on-year to $456.1bn – the first global decline “since the World War Two days”.
Stateside, Coen sees adspend slipping 4.1% from $243.7bn in 2000 to $233.7bn this year, the first downturn since 1961 and the largest since 1938. He attributes the situation to a massive retrenchment in spending by dotcoms, down from $5.6 billion last year to $2.4 billion. The “terrible state” of key sectors such as airlines, brokerage firms, computers and telecommunications is another factor.
But elsewhere on the globe, Coen believes, there will be a marginal increase in 2001 adspend, up 1% from $220.2bn to $222.4bn.
Switching channels on his crystal ball to 2002, he sees a 2.2% increase in global adspend to $466.1bn. Of this total, US expenditure will rise 2.4% to $239.3bn, boosted by such factors as the Winter Olympics in Salt Lake City and the Congressional elections next fall. Overseas adspend will improve by 2% to $226.8bn.
Some delegates to the conference are reportedly skeptical about these or any other predictions, recalling that both men have revised their estimates downward three times already this year.
News source: New York Times