According to Ibope and The Nielsen Company, the global advertising industry climbed out of recession last year and posted a 10.6 percent year-on-year increase to USD 503 billion (At rate card values and based on four major media types) based on published rate cards.
Strong performance in Latin America and Asia Pacific. Hefty rebounds from the automotive and financial sectors, and World Cup spending propelled the advertising industry back into positive territory.
“2010 was the year of recovery for the advertising industry,” said Randall Beard, global head of Advertiser Solutions for The Nielsen Company. “All global regions and every traditional medium (television, radio, newspapers and magazines) recorded a positive turnaround with highest percentage ad spend increases coming from Middle East/Africa and Latin America, which rose 26.7 percent and 21.2 percent respectively. Overall 23 out of 37 global markets posted double-digit ad growth last year in a clear indication that advertisers regained confidence to spend again after a weak 2009 where every region except for Asia Pacific posted declines.”
Two of the hardest hit sectors during the global downturn, automotive and finance, returned from their recession hiatus and increased ad spend by 20.3 percent and 17.9 percent respectively. Six automotive companies were among the top 20 global advertisers in 2010.
Ad spend for fast moving consumer goods (FMCG) increased 14.6 percent in 2010 and the sector’s share of ad spend also increased from 23.9 percent to 24.9 percent. FMCG spend in Middle East/Africa increased by 34.3 percent, Latin America (+23.9%) and Asia Pacific (+16%).
All traditional advertising media types showed increases in 2010, particularly television which rebounded 13.1 percent and increased to 62 percent of all ad spend share – the highest on record and up from 60.6 percent the previous year. Radio advertising rose 8.5 percent, followed by newspapers (+7%). Magazines recorded the slowest growth of all media types at 4.9 percent globally, and only posted double-digit growth of 14.9 percent in Latin America.
Emerging markets with their younger populations, increasing disposable incomes and hungry consumption appetites attracted advertisers to new booming markets in Egypt (+40.8%), Pan-Arab (+43%) and Argentina (+38.9%), which recorded the highest percentage advertising increases.
Latin America, in addition to posting the second highest regional ad spend increase (+21.2%) in 2010, spearheaded by Argentina, also benefited from the highest ad increases across the Financial (+37.2%), Entertainment (+17.8%), Clothing/Accessories (+22%) and Media (23.8%) sectors.
The USA, the world’s largest advertising market, had one of the slowest growth rates of 5.6 percent year-on-year, but is back in positive territory after advertising expenditure dropped nine percent in 2009. The only market to experience a decline in advertising in 2010 was the United Arab Emirates (-4.4%) while advertising remained flat in economically battered markets of Japan (+1.3%) and Spain (+0.4%).
Methodology: The data sources for the countries included in the report are: Argentina: IBOPE, Brazil: IBOPE, Egypt: PARC (Pan Arab Research Centre), France: Yacast, Hong Kong: admanGo, Japan: Nihon Daily Tsushinsha, Kuwait: PARC (Pan Arab Research Centre), Lebanon: PARC (Pan Arab Research Centre), Mexico: IBOPE, Pan-Arab Media: PARC (Pan Arab Research Centre), Saudi Arabia: PARC (Pan Arab Research Centre), Spain: Arce Media, UAE: PARC (Pan Arab Research Centre), Remaining countries: Nielsen Media Research