Warc Blog

Prospects soften for ad market

10 January 2012
LONDON/WASHINGTON: Advertising expenditure prospects seem to be worsening across the globe, as most of the world's biggest ad markets have seen downgrades to their predicted growth levels in 2012.

According to Warc's latest Consensus Ad Forecast, advertising revenues will rise by 5.4% worldwide this year, compared with the expansion of 6.3% outlined in August 2011, indicative in particular of on-going economic concerns.

The debt crisis in the Eurozone has exerted an especially powerful impact, meaning Germany is now expected to witness a modest 1.8% lift in 2012, well behind the 2.6% increase detailed last August.

France is also anticipated to deliver growth of just 0.9%, an improvement that had been pegged at 2.4% in August 2011. Italy was off from 2.7% to 0.7% on the same terms.

Conditions appear to be most austere in Spain, where adspend should contract by 2% in 2012. The markdown in expectations from an expansion of 2.5% in August reflects the difficult financial situation facing the country.

Unsurprisingly, major emerging economies are likely to drive growth, with China up 14.7% year on year, Russia improving by 14%, India logging a 12.4% leap and Brazilian expenditure increasing by 10.2%.

Even these nations were not inured to the broader headwinds, with Russia's figures down by 5.9 percentage points from August 2011, a total standing at 3.8 points for India, 1.6 points for China and one point for Brazil.

Elsewhere, the US, UK and Australia all saw negative revisions. As a result, each country will enjoy annual growth of roughly 3%.

Japan was the only major market to see an upgrade, gaining 0.4 percentage points, and set for a 2.6% increase in 2012, having recovered more quickly than anticipated from last year's natural disasters. Canada's forecast expansion of 4.3% was flat.

Suzy Young, Warc's data editor, said: "Continued political and economic instability around the world has led marketing industry analysts to trim their growth forecasts over recent months.

"Nevertheless, persistent strength in fast-growth markets and the quadrennial effect of the Olympics and US presidential elections should ensure there is little prospect of the industry suffering a 'double dip' in 2012."

Warc's Consensus Ad Forecast covers 13 major markets, and uses a weighted average of adspend predictions at current prices from ad agencies, media monitoring companies, analysts, Warc's own team and industry bodies.

Data sourced from Warc

 
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