NEW YORK: US adspend should register solid growth in 2012, according to the latest forecast from the Pivotal Research Group.
The market research firm is expecting a +3.2% expansion for the world's largest ad market this year, a revision up from the +1% predicted when Pivotal last released a forecast in late 2011.
Pivotal's latest predictions also exclude the quadrennial TV adspend uplift that traditionally occurs in the year of the Olympics and US presidential election.
The report also suggested that US adspend grew by +3.1% last year. The upgrade for 2012 is based on better-than-expected data for the first quarter.
"In short, 2012 is so far pacing ahead of where we previously thought it would, and the rest of the year looks better than we initially forecast ... advertising has resumed a normal growth pattern despite the tepid state of the overall economy," Brian Wieser, senior research analyst at Pivotal, said.
But the report also warned that the ad industry recovery could be impacted by the "fiscal cliff" – a combination of tax rises and government spending cuts that will automatically be imposed by US lawmakers in early 2013, should no bipartisan agreement on government deficit reduction be reached.
Pivotal suggested that conflicts in Washington in the run-up to the "cliff" could have the effect of lowering overall adspend growth.
Under this scenario, adspend would register a decline of up to -1.8% next year, Pivotal said. But a speedy resolution would result in "modest" annual growth of +2.5%.
Media-wise, Pivotal predicted standout growth for mobile advertising, up +66% in 2012, while national TV is forecast to rise +6% and digital display from +7–8%.
Data sourced from Pivotal Research Group; additional content by Warc staff