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Global TV budgets take a hit

News, 30 March 2015

LONDON: Marketing optimism remained at a high level in March, as the latest Global Marketing Index (GMI) edged upwards, but there was also a noticeable shift in the allocation of budgets away from TV and towards mobile and digital.

The headline GMI rose 0.4 points to 57.4 – a reading of 50 indicates no change while 60+ indicates rapid growth – with robust marketing activity recorded in each region: 57.0 in Europe (+0.3), 58.6 in the Asia-Pacific area (+0.3) and 57.1 in the Americas (+0.6). These figures are now based on a three month moving average to mitigate abnormal seasonal variations.

Compiled by World Economics, the GMI provides a unique monthly indicator of the state of the global marketing industry because it tracks current conditions for marketers as well as their expectations for marketing budgets, trading conditions and staffing levels.

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The first of these measures – the Index for Global Marketing Budgets – dropped by 1.2 in March to register a value of 53.5, but remained in positive territory to record the 25th consecutive month of budget growth.

Within that, however, the Index indicating spending on TV budgets across the world fell 1.4 to a score of 48.4. This decline follows six months where the Index oscillated around the 50.0 no change level.

World Economics reported that the "collapse" of TV budgets was most evident in the Americas where the Index value had fallen 1.3 points to 43.3, while that for Asia Pacific was also down 1.2 points to 47.1. This denoted nine and eleven consecutive months of decline in the respective regions' spending assignment.

Only in Europe were TV budgets continuing to grow, although even there the March Index value of 53.8 was 2.5 points down on February.

In contrast the Index for expenditure on Mobile rose by 2.0 to reach 74.2 in March, a pattern of rapid and accelerating growth seen across all regions. Similarly, the Index for Digital hit 77.5, up by 1.9 on its February value.

The fastest growth of the Digital Index was in the Americas, where it rose 3.3 to 76.7. Taken together with the drop in the TV Index for the region, this suggests that a significant and oft-predicted shift may be finally under way.

Data sourced from World Economics; additional content by Warc staff