The green shoots of recovery are slowly pushing through the adspend permafrost, according to global media agency ZenithOptimedia.

In its annual December gaze into the crystal ball, the London-headquartered shop forecasts …

The two year advertising recession will end in 2003 with 1% real global growth;

• The TV medium and leading US advertisers are already setting the pace;

• The 2004 US presidential election/Athens Olympics will consolidate ad recovery;

• Downside fears of war and consumer retrenchment subdued.

In terms of hard numbers: the estimated regional adspend revenues for 2002 below are expressed in US$ millions ($1m = €0.992m; £0.634m). 2003 figures are in parentheses and percentages indicate year-on-year change at current prices:

USA/Canada - $148,777 ($151,651) +1.9%

Europe - $72,109 ($73,885) +2.5%

Asia Pacific - $64,280 ($66,942) +4.1%

Latin America - $16,899 ($17,659) +4.5%

Rest of world - $9,634 ($10,579) +9.8%

Major media total - $311,699 ($320.716) +2.9

Comments Zenith: “The influence of US ad sentiment on the rest of the world is greater than ever. Aside from the growing internationalisation of brand and media management, the simple fact is 46% of the world’s ad dollars will be spent in the USA in 2002. This compares to 44% coming out of the last recession in 1992. Advertising in the developing world grows much faster, but accounts for only 13% of today’s total advertising spend. It was 8% in 1992, but even with this substantial increase the developing nations will not be the locomotive for the next advertising recovery.”

As to Europe: “Television and radio in France have returned real rates of growth in 2002 against a dismal background of advertising recession in which the print sector is suffering badly. We do not expect newspapers to join the recovery until 2004. Consumer spending growth is expected to pick up from 1.8% in 2002 to 2.0% in 2003 in line with a moderate improvement in GDP growth which will still lag the EU average.

The UK economy is in relatively good shape but our advertising forecast is the most bearish of the big five European markets. Television is expected to grow 4% in current prices in 2002, which is well ahead of the market average, but we do not expect this rate to vary much out to 2005. This is half the typical growth rate of the 1990s, but echoes the redistribution of TV ad budgets and audiences towards smaller channels with cheaper airtime. We do not expect real growth in the print sector before 2006.

Consumer demand in Germany is expected to shrink 0.5% in 2002 and recover +1.4% in 2003. Economic growth is expected to improve by a similar margin from near-zero at present. Our forecasts suggest this will not be enough to produce real advertising growth in 2003, but the worst appears to be over. Germany’s print sector takes 67% of all advertising and obviously has a great bearing on this. Fortunately we do not expect it to lag the recovery like print sectors in most markets.”

Data sourced from: ZenithOptimedia; additional content by WARC staff