Despite the stock market's double digit drop in the last quarter, ZenithOptimedia is projecting a 2.2% increase in advertising for 2011, up from the agency's 2.1% forecast in July. The report also forecasts a 3.5% increases in both 2012 and 2013.
The media agency sees cable TV growing 12% this year, while the broadcast networks decline 2% and syndication slips 4%, taking into account
current economic conditions and its knowledge of its clients' plans for the upcoming season.
The report notes that woes on Wall Street often are not necessarily followed by an ad market decline.
In 12 market crashes over the past 31 years. the agency said. "... half of the stock market crashes preceded an advertising downturn, but half did not." Most recently, says the report, "the sharp drop
in the Dow in the U.S. after September 11 did not prevent the recovery of growth in 2002, though growth remained weak."
Top Ten Ad Markets (US$ Million, Current Prices; Currency Conversion At 2010 Average Rates) | |||||
2010 | 2013 | ||||
Rank | Country | Adspend | Rank | Country | Adspend |
1 | USA | $151,665 | 1 | USA | $165,977 |
2 | Japan | 46,153 | 2 | Japan | 47,630 |
3 | China | 26,122 | 3 | China | 38,854 |
4 | Germany | 23,791 | 4 | Germany | 25,429 |
5 | UK | 18,086 | 5 | UK | 19,656 |
6 | Brazil | 14,716 | 6 | Brazil | 17,587 |
7 | France | 12,564 | 7 | France | 13,465 |
8 | Australia | 11,246 | 8 | Australia | 12,313 |
9 | Italy | 10,296 | 9 | Canada | 12,098 |
10 | Canada | 10,041 | 10 | Russia | 11,413 |
Source: ZenithOptimedia, October 2011 |
The report expects that cable networks will continue to build momentum, largely because of the return of big-spending automotive and financial advertisers. The forecast calls for cable to grow:
The agency expects the spot marketplace to be extremely volatile in 2012 with the presidential election year cycle generating a billion dollars or so in political spending. Adding to the frenzy will be the Olympics in August, bringing new and returning business to the local markets. All considered the report expects spot to TV to turn in annual increases of:
Advertising Expenditure By Medium (US$ Million, Current PricesCurrency Conversion At 2010 Average Rates); And Share Of Total Adspend | ||||||||||
| 2009 | 2010 | 2011 | 2012 | 2013 | |||||
Newspapers | 96,973 | 23.0% | 95,416 | 21.5% | 92,802 | 20.2% | 91,911 | 19.0% | 91,334 | 17.9% |
Magazines | 43,633 | 10.5 | 43,741 | 9.8 | 43,224 | 9.4 | 43,060 | 8.9 | 42,909 | 8.4 |
Television | 160,199 | 38.4 | 176,826 | 39.8 | 184,929 | 40.2 | 196,182 | 40.5 | 207,056 | 40.5 |
Radio | 31,778 | 7.6 | 32,169 | 7.2 | 32,899 | 7.1 | 33,906 | 7.0 | 35,117 | 6.9 |
Cinema | 2,107 | 0.5 | 2,315 | 0.5 | 2,423 | 0.5 | 2,564 | 0.5 | 2,718 | 0.5 |
Outdoor | 27,774 | 6.7 | 29,917 | 6.7 | 31,503 | 6.8 | 33,357 | 6.9 | 35,122 | 6.9 |
Internet | 54,683 | 13.1 | 64,026 | 14.4 | 72,531 | 15.8 | 83,457 | 17.2 | 96,392 | 18.9 |
Total * | 417,147 |
| 444,410 |
| 460,311 |
| 484,436 |
| 510,648 |
|
Source: ZenithOptimedia, October 2011 |
Video ads are "... becoming the main form of brand advertising in the digital space," the report says, adding that the streaming video category will see two out of every five ad dollars coming from local advertisers. The agency projects:
Internet Advertising By Type (US$ Million, Current Prices Currency Conversion At 2010 Average Rates) | |||||
Ad Type | 2009 | 2010 | 2011 | 2012 | 2013 |
Display | $18,349 | $21,875 | $25,282 | $29,713 | $35,218 |
Classified | 9,911 | 10,950 | 11,990 | 13,078 | 14,246 |
Paid search | 26,423 | 31,202 | 35,259 | 40,666 | 46,928 |
Total | 54,683 | 64,026 | 72,531 | 83,457 | 96,392 |
Source: ZenithOptimedia, October 2011 |
The analysis has made a reduction to its forecast for global ad expenditure growth in 2011 to 3.6%, down 0.5 percentage points from the forecast
made in July. The slowdown in economic recovery in the developed markets, coupled with rising fears of double-dip recession, have caused some advertisers to trim back budget increases planned for the
end of 2011, but with no sign of the cancelled campaigns and sharp budget cuts that signaled the beginning of the last advertising downturn in 2008.
The report predicts global ad expenditure at
5.3% growth in 2012, and 5.5% in 2013. TV's share of total ad spent was 38.4% in 2010 and should grow to 39.8% in 2011 and settle at 40.5% by 2013.
In summary, this picture is consistent with a history of ad market growth after many previous stock market shocks, assuming the world economy does not deteriorate dramatically:
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