Global spending on advertising will continue to recover next year, headed by expanded internet marketing and cost in emerging economies, as found by researchers ZenithOptimedia Group Ltd. and Magna Global.
An increase of 4.6 percent on spending is expected next year, after a 4.9 percent strong growth in 2010, according to ZenithOptimedia, a media buying company which is owned by Publicis Groupe SA. Magna, which monitors ad sales but not spending, forecasts a 5.4 percent gain in 2011, following a 6.9 percent rise this year.
Web advertising gains thrice as fast as the overall market, as stated by London-based ZenithOptimedia. China will be the next giant ad market lagging just behind the U.S. and Japan next year. ZenithOptimedia also indicated that as spending recovers after the financial crisis in 2008, the growth in advertising does not meet its long-term trend rate of 6 percent.
Steve King, CEO of ZenithOptimedia said in the report that the key result of this latest information is the continued growth of developing markets and digital media, and their vital role in international growth. In a report by ZenithOptimedia, global outlays will not surpass the height of 2008 until 2012. Increasing debts in the developed countries, U.S. unemployment rate and the failure to pay debts of some countries in the Eurozone create risks to recovery.
The company projects growth of 5.2 percent in 2012 and 2013 while total global ad spending will be $449.7 billion in 2010.
Web spending will go up to 18 percent in 2013 from 14 percent of the market this year, spurred by video and social media, according to ZenithOptimedia. Newspaper and magazine expenditures will descend 2 percent while the dominance of television as a medium will increase by 42 percent by 2013 from 41 percent in 2010.
King mentioned in the report that Internet expenses may expand and be fueled by Web-related “activities that do not count as ad expenditure in the traditional sense.” With ad outlays projected to a 51 percent increase for the next two years, China will outdo Germany as the third largest ad market in the world by 2011 and the Asia Pacific spending will increase 23 percent, ZenithOptimedia said.
Latin America spending will rise 26 percent from 2010 to 2013. Expenditures in North America will increase 9 percent while Japan will grow 5 percent during the same period, ZenithOptimedia said. Expenditures in central and Eastern Europe will rise 31 percent.
Magna, which is owned by Interpublic Group of Cos., projects worldwide advertising sales to increase 5.4 percent to $412 billion in 2011 and outperform the firm’s previous estimate of 4.2 percent with Argentina, India and China on the lead. The ad market regained strength more quickly this year than projected, with an estimated growth of 6.9 percent surpassing the previous 5.6 percent as anticipated by the firm.
The New York-based firm Magna reported that online advertising will outpace newspapers as the world’s second-largest ad medium following television by 2013 while Revenue on Internet ads is anticipated to reach $117 billion by 2016.