Zenith's Gloomy Expectations for US and Global Adspend

08 October 2008

LONDON: ZenithOptimedia, Publicis Groupe's media planning and buying unit, is long-faced about adspend prospects both for 2008 and 2009, stateside and across the globe.

It expects US ad spending to grow just 1.6% this year and by less than 1% in 2009. As recently as June, it predicted respective growth of 3.4% and 2.6% for this year and next.

The dive in growth expectations is Draconian – a decline of 47 percentage points this year and 38.5 points in 2009.

Globally, the picture is similarly dour, with adspend growth predicted to fall from +6.6% to +4.3% for 2008; and in 2009 down from +6% to +4%.

In monetary terms, this year's spend is estimated at $506.3 billion (€374.81bn; £291.31bn). 

Even these downbeat estimates are seen as PollyAnna-ish in some quarters.

Opines Nick Brien, ceo of Interpublic Group's Mediabrands: "I don't see any growth for the industry next year. It will be scary. There are no Olympics, no election spending and the real impact of what happened on Wall Street will filter down."

Worse yet, a cash-up-front mindset is fast developing as the global economy lurches from dire to catastrophic.

"We are definitely asking some clients for cash in advance of buying ad time," says Geoff Robison, vp of national broadcast at independent media-buyer Palisades Media in Santa Monica.

And watchful eyes among the media shops are increasing scanning payrolls. Says Steve Lanzano, coo at Havas-owned MPG North America: "Our biggest expense is salaries. There may be some investment we will not be able to make."

Data sourced from Wall Street Journal Online; additional content by WARC staff