NEWS23 August 2012

Marketing expenditure falls but adspend predictions remain positive

Financials UK

GLOBAL— Marketing expenditure levels continue to decline around the world but experts are predicting that global advertising expenditure will grow overall in 2012 and 2013, though this will be slower than previously estimated.

Warc’s latest Global Marketing Index, which is based on data from a panel of 1,225 executives, found that global marketing budgets fell to their lowest level this year in August with the monthly reading for marketing spend reaching 46.1 points.

The intelligence firm says the low figure for August constitutes a decrease of 1.4 points compared with July, and was mainly driven downward by Asia Pacific, where the index fell by 4.7 points, to 46.

The situation remained largely unchanged in Europe, albeit on a highly negative 40.9. The Americas, by contrast, posted an improvement from 52.3 to 53.5.

“Marketers in Asia Pacific and Europe are reducing budgets,” said Suzy Young, Warc’s data editor. “In the months ahead, it will be interesting to see if the sudden dip for Asia Pacific is representative of a more deep-rooted downturn.”

However, seperate figures from media agency Carat suggests that despite the economic uncertainty across the continents, global advertising expenditure will grow by 5% in 2012 – down from 6% previously – and 5.3% in 2013 – down from previous estimates of 5.8%. It claims that the growth will be possible due to the “two-speed world, whereby we continue to see growth from the faster-growing regions”. It will also be helped by an expected boom in digital marketing, which will become the second biggest medium behind TV during this period.