NEWS9 January 2013

Warc predicts 4% global adspend increase

Financials UK

GLOBAL — Advertising expenditure growth is expected to increase by 4% this year and 5.5% in 2014 despite the fragility of the global economy, according to Warc’s latest Consensus Ad Forecast.

The Consensus Ad Forecast is based on a weighted average of adspend predictions at current prices from ad agencies, media monitoring companies, analysts, Warc’s own team and industry bodies. The figures are a slight increase on the 3.9% uptick estimated for 2012.

Warc predicts that 11 of the 13 featured markets should grow this year, and all of them will next year. The BRIC economies are set to be the biggest winners with Russia estimated to experience a 12.3% leap, followed by China on 10.9%, Brazil on 9.8% and India on 8.5%.

However, the ongoing Eurozone crisis looks set to disrupt growth across the continent with France predicted to only see a 0.1% rise and Italy and Spain set to log the worst performances in 2013, with adspend down 1.1% and 2.8% respectively. The UK is the only European market in Warc’s study expected to buck this trend with growth of 3%. The US, the world’s biggest advertising market, is line to enjoy expansions of 2.2% in 2013 and 4% in 2014. It was also projected to have witnessed a 3.7% gain in 2012.

By channel, the internet is predicted to increase demand in excess of 13% annually going forwards, although this marks a moderation from the estimated 14.4% expansion recorded last year. Television will also prove robust, as revenues rise by 3.2% in 2013 and 6.4% in 2014. However, newspaper ad sales are pegged to contract by 2.7% this year and 1.6% next, figures hitting 2.5% and 1.7% for magazines, indicating the broader structural issues facing the print sector.

Suzy Young, Warc’s data editor, said: “In 2012, the industry benefited from the Olympics and the US presidential election. In 2013, we’re all keen to see how advertising holds up without these quadrennial factors. There are still risks for global economic growth. Marketers are not ready to adjust their cautious approach just yet.”