Global Ad Forecast 'Finally Stops Tumbling'

Worldwide ad spend in measured media is expected to drop 5.5% to $417B in 2009 but will experience a mild recovery in 2010 with a falll of 1.4%, or $411B, according to the latest 70-country forecast report from GroupM. Though GroupM expects global picture to improve in 2010, ad spending in the U.S. & other G7 nations (CN, France, Germany, Italy, Japan & UK) will likely lag behind the BRIC nations (Brazil, Russia, India & China) and continue to experience negative growth into 2010, MarketingCharts writes.
U.S. and G7 Ad Spend
Advertising expenditures in the U.S. are expected to fall 4.3% this year followed by an anticipated 6.5% drop in 2010, according to the report. These figures compare with an average 6.4% decline in 2009 followed by a 5.5% drop in '10 inthe G7 nations. GroupM CIO Rino Scanzoni said U.S. ad spend should stabilize this year & next, but will still be down. "We expect a bottoming out on local media spend in 2009 with more stability into 2010," he said. "However, we are expecting further contraction on national media particularly TV as clients adjust budgets to reflect a continued pessimistic consumer spending forecast."
BRIC Growth
On the positive side of the equation, the BRIC countries are expected to contribute strongly to worldwide ad spending growth and lead the recovery. "China's economic stimulus has already bolstered confidence, and the demand for ad in Russia will recover quickly if $70-a-barrel oil prices are here to stay," said Adam Smith, GroupM's futures director. "Brazil & Indonesia remain among the top growth contributors, & India is predicted to come back strongly after pausing in 2009." He confirmed overall global prospects for a limited ad recovery in 2010 are improving. "Ad lagged economic recovery for about 18 months after the recession of 1992 & 1 year after the one in 2001," he said. "Our global forecast for '09 finally stopped falling. The 15 countries still reporting positive ad growth in 2009 became 33 in 2010, and the number can rise as we phase through the year."
Packaged Goods Sustain Advertising
The report also revealed packaged goods marketers contributed significantly to sustaining adv during the recession, while auto & financial showed the largest pullbacks. This resulted in TV and out-of-home adding global ad investment share, & newspapers continuing to shed almost 1 share point about annually, it said.
Digital Grows Despite Saturation
Despite broadband saturation & adv cutbacks in many developed economies, digital media continued to grow, rising from 10% of global ad investment in 2007 to a predicted 15% in 2010.