GLOBAL: Desktop advertising has peaked and is set to shrink by more than newspapers or magazines over the next two years, according to a new forecast from Zenith.
The media agency's latest Advertising Expenditure Forecasts noted that global spending on desktop advertising shrank 0.1% in 2015, to $98.9bn, as advertisers switched their budgets to mobile and expected this trend would gather pace.
It projected a 0.8% decline in desktop advertising in 2016, rising to -2.9% in 2017 and -7.4% in 2018.
Between 2015 and 2018 desktop adspend will shrink by a total of $10.7bn, it said, more than the other two declining media: newspapers will shrink by $9.6bn and magazines by $4.4bn.
Meanwhile mobile adspend will grow by $81.3bn over the same period, seven times more than the combined growth of television ($7.3bn), outdoor ($3.0bn), radio ($0.9bn) and cinema ($0.7bn).
Mobile will overtake desktop next year and by a greater amount than Zenith had previously predicted – $8bn rather than $2bn – as it upgraded its forecasts for mobile growth, adding an extra two percentage points for this year (to 48%) and four (to 33%) for next year.
By 2018, it said, mobile would account for 60% of all internet advertising, up from the previous figure of 58% in June's forecast.
Zenith also nudged upwards its global advertising expenditure forecasts, with 2016 growth now expected to hit 4.4% rather than 4.1%, generating total revenues of $539bn.
"This upgrade is mainly the result of stronger-than-expected growth in the US, where a strong labour market has encouraged consumers to increase their expenditure, and advertisers have fought harder for their share of the expanding market," Zenith said.
Slight upwards revisions were also made to its figures for Asia Pacific (+0.1 percentage points to 6.3%) and Western Europe (+0.1 percentage points to 3.6%).
UK spending will weaken "mildly" in the wake of the Brexit vote, with growth now expected to be 5.4% this year (down from a pre-vote figure of 5.6%) and 3.4% next year (down from 4.0%). These figures compare to the growth rates of +5.2% and +4.5% predicted for this year and next by the AA/Warc Expenditure Report.
Most of the impact of Brexit will come in the long term, Zenith added, as the UK's new terms of trade with the EU and other countries are likely to lead to slower economic growth and slower growth in advertising expenditure.
Data sourced from Zenith; additional content by Warc staff