Some of the major projections from ZenithOptimedia:
- The US ad market has been downgraded to 2.5% growth in 2007 from the previous estimate of 3.3%, because of the credit squeeze and continued slump in the housing market.
- The Olympic Games will help lift television’s share of the global ad market to a record 38.2% in 2008.
- Online video and local search will drive 30% growth in internet ad expenditures in 2007 – nine times faster than the rest of the ad market.
- Between 2006 and 2009, internet ad spend will grow 85% and raise its market share from 6.1% to 9.5%.
Other forecast data issued by ZenithOptimedia:
Despite the many challenges confronting TV – the spread of digital video recorders, migration of viewers from premium mass-audience channels to cheaper specialist channels, and competition from the internet, among others – TV will increase its share of global ad expenditure from 37.9% in 2007 to 38.2% in 2008, an all-time record, ZenithOptimedia forecast.
Though TV is losing market share in many countries in North America and Western Europe, the faster ad growth of markets elsewhere, which have fewer alternatives to TV, is counteracting the trend, Zenith said.
In 2008 it expects TV’s share of ad expenditure to fall 0.3 percentage points to 32.4% in North America, and 0.5 percentage points to 30.4% in Western Europe.
It also said it expects the coverage of the Olympics in Beijing to give an extra boost to television in 2008, particularly in China and its neighbors: Zenith forecast television’s share to grow by 0.5 percentage points to 41.3% in China, by 0.3 points to 42.5% in Asia Pacific, and by 0.3 points to 38.2% across the world.
In the absence of the Olympic Games, TV’s share would have declined to 38.1% – which is as high as its previous peak, in 2004, Zenith said.
ZenithOptimedia again revised upward its forecasts for internet advertising: It projects 29.9% growth this year (up from 28.6% from its forecast three months ago) and 85% growth between 2006 and 2009 (up from the previous forecast of 82%).
Online video and local search are the new, fast-growing segments, but display, classified and the rest of search are still growing rapidly as well.
Internet advertising is expected to account for 9.5% of all expenditure in 2009, fractionally up from the 9.4% Zenith forecast three months ago.
Newspapers are suffering the most from the depredations of the internet, which is better at delivering timely news and is an efficient substitute for newspaper classifieds, according to Zenith.
Newspapers’ share of world ad expenditures is expected to fall from 29.0% in 2006 to 26.2% in 2009.
By contrast, outdoor is healthy; its market share is forecast to increase from 5.6% in 2006 to 5.9% in 2009, in part because new digital out-of-home displays make it easy for advertisers to book and distribute eye-catching ads on short notice, Zenith said.
The continued slump in the US housing market has also led to a sharp drop in property and construction advertising, particularly property classifieds in newspapers; that and the recent credit squeeze have led to Zenith’s downgrading of its 2007 forecast for the US from 3.3% growth to 2.5%.
The 2007 forecasts for Western Europe, Asia/Pacific and Latin America are largely unchanged.
Central/Eastern Europe and the Middle East – already standout growth regions – have been upgraded again: Central/Eastern Europe is expected to grow 18.3% this year (up from the 16.9% projected three months ago) and Africa/Middle East/Rest of World is expected to grow 17.2% (up from 15.6%).
Eight of the ten fastest-growing markets in the world are in Central & Eastern Europe; the other two are in the Middle East.