Global advertising spend continues to recover

2:02 PM, 9 November 2010

Advertising expenditure will increase by over 4% worldwide in each of the next two years, with TV, social media and mobile all enjoying strengthening demand.

ZenithOptimedia, a unit of Publicis Groupe, estimated revenues would rise 4.8% to $449.5bn (€323.7bn; £282.7bn) this year, compared with the 3.5% uptick outlined in its last report, published three months ago.

"We are seeing growth across the board and the recovery is steeper than we originally forecast," Tim Jones, CEO of ZenithOptimedia's North American arm, said.

Television ad revenues are anticipated to leap 9% worldwide this year, hitting $180.4bn, while online expands 13% to $61.5bn, both gaining as newspapers struggle.

TV's share is expected to reach 41.6% in 2012, measured against 39.2% in 2009, figures standing at 16.5% and 12.8% respectively concerning digital channels.

Paid search will deliver 51.4% of new media returns in two years time, when display will take 33%, aided by social media, video and mobile formats. Indeed, mobile was forecast to grow at 44.3% per year between 2009 and 2012, with social media up 31.2% annually in the same period, ahead of the 14.6% acceleration across the web as a whole.

Looking forward, global advertising expenditure could witness a slightly slower 4.6% improvement next year.

"Advertisers in the developed markets remain cautious about the future, and will not commit to ambitious expansion plans while unemployment and debt remain so high, and government spending cuts threaten the recovery in demand," ZenithOptimedia suggested.

Brands owners are due to boost their investment by a further 5.4% during 2012, Zenith stated.

Adspend levels currently equate to a 0.75% share of GDP, a decline from 0.88% in 2007, with a decrease to 0.74% probable in 2012."We do not expect this proportion to rise while debt, unemployment and austerity threaten the recovery," Zenith concluded.

Source: WARC, October 2010

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