Despite mounting economic pressures, global advertising spend was up over 4% in the first quarter of 2008 compared with the year-earlier period – led by nearly 10% growth in the Asia-Pacific region, according to the Nielsen Company’s Global AdView Pulse report.
Television remained the highest-grossing medium for advertising spend in Q1, recording a 6.9% growth rate globally – and growth in every region – and accounting for 60% of global ad spend:
Newspapers, representing almost 24% of spend, remained flat (0.4%) and magazines declined slightly (-0.9%).
Globally, healthcare retained the majority share of ad spending, with just over 10% of all advertising activity. With 9% of global consumers ranking their health as their biggest concern today (Nielsen Global Consumer Concerns report, May 2008), this figure could continue to rise, Nielsen said.
Fast-moving consumer goods (FMCG, aka CPG) advertising spend is also growing at a significant rate (6.7%), recording growth across all regions, and ad spend in the clothing & accessories sector grew 5.5%, according to Nielsen.
More of the findings and analysis issued by Nielsen, below.
In the first quarter of 2008, ad spending in Africa grew over 16%, and the Asia-Pacific region recorded almost 10% growth. In more-developed North America and Europe, growth was much slower – ad spending in North America climbed just 1% and declined in Europe (-0.4%). As a result, each of those two regions lost one share point Asia Pacific.
North America1 recorded slight total growth (1.2%), despite a softening US economy and the recent Writers’ Guild of America strike. These negative factors were offset somewhat by political advertising related to the US Presidential Elections.
Although Canada’s media environment was affected by the strikes, the stronger economic situation in Canada allowed the local advertising market to close the first three months of the year with a percentage growth higher than the one registered in the USA.
Of the three regions surveyed2, Asia Pacific showed the most growth across the quarter, registering 10%3. All four major media types (television, magazines, print and radio) contributed to this growth. This region is expected to benefit further from economic development in fast-growing Asian markets.
On the other hand, elements of uncertainty linked to the world economic situation and the increase in oil and commodities prices have reached Asian and Oceanian soil, and the effects of these pressures may slow this region’s overall upwards trend.
The rise of ad spending in Asia Pacific has been attributed to strong growth in China, India and Indonesia; in other markets, growth remained flat.
According to Nielsen analysts in China, the Chinese economy is expected to remain strong in 2008. Nielsen is forecasting increased growth this year, due to the popularity of internet video advertising and local search.
The advertising market in Europe4 remained flat over the first quarter of 2008. Television, which accounts for almost 50% of total European advertising spend, is the only media type showing positive growth (2.2%)
The slow economic growth of many European markets and the effects of economic uncertainty have had an impact on advertising trends across the region; however, there is an expectation that the recent UEFA Euro Cup 2008 and the upcoming Olympic Games will have a positive influence on advertising spend in the second half of the year.
According to Nielsen experts in Germany, in the first three months of 2008 almost 30 million Euros were invested in campaigns with a direct or associated reference to the UEFA European Football Championship in that country.
Even in oil-rich Norway, where the economy is going from strength to strength, there are now signs of more moderate development. According to market analysts from Nielsen Norway, the main drivers behind this moderation are a marked decline in economic growth among Norway’s trading partners, a stronger Krone and several interest rate rises in the past year.
South Africa’s5 advertising market grew a stunning 15.3% over the quarter. As usual, television and print have the lion’s share, but internet advertising is gaining momentum in this market, growing by a whopping 67% across the three-month period.
According to Nielsen analysts, television viewing in South Africa may have been affected by a power crisis in early 2008, causing widespread blackouts across the country, but the extent of the impact is still unknown.
1 Two markets in North America: United States and Canada
2 Three regions: Asia Pacific, North America and Europe. Africa is represented by South Africa alone, which grew 15.3%.
3 12 markets in Asia Pacific: Australia, China, Hong Kong, Indonesia, Japan, Malaysia, New Zealand, Philippines, Singapore, South Korea, Taiwan and Thailand.
4 8 Markets in Europe: Germany, Italy, the Netherlands, Norway, Spain, Switzerland, Turkey, United Kingdom.
5 South Africa is currently the only surveyed market in Africa.
6 Source: Nielsen Global Consumer Concerns report, May 2008