ZenithOptimedia Optimistic about Ad Spend Growth

July 2, 2007

This article is included in these additional categories:

Asia-Pacific | Broadcast & Cable | Europe & Middle East | Global & Regional | Magazines | Newspapers | Out-of-Home | Radio | Television

ZenithOptimedia apparently has a rosier view than other recent ad market prognosticators, and only slightly decreased its 2007 forecast of US advertising spending growth year over year – from 3.4% to 3.3% – despite a 1.7% anticipated decrease for network TV and 1% drop for spot TV this year.

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Zenith expects US internet spending to grow 29%; cable TV and traditional outdoor are expected to gain 6% in revenue; consumer magazine ad spend is forecast to increase 4.6%; radio is expected to grow just 1%; and newspapers and syndication are forecast to remain flat.

Globally, however, ad spending is forecast to increase 5.5% in 2007, up from Zenith’s previous forecast of 5.2% in March.

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Zenith also upped its 2008 forecast to 6.4% ad spending growth from its 6.2% forecast in March, because of the Olympics, the US presidential elections and the World Cup. And for 2009 Zenith now forecasts 5.4% growth rather than the 5.0% it forecast in March.

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From 2007 to 2009, for the first time in the last decade, ad spending growth in Western Europe is expected to be greater than in the US, according to Zenith, which said over the past 10 years US ad spend has grown 5.2% a year, on average.

Zenith also forecasts that China will become the world’s fifth-largest ad market this year, surpassing Italy. In 2005 China was the seventh-largest ad market.

All of the fastest-growing markets, as might be expected, are in the Middle East and Central & Eastern Europe, with media markets in both regions maturing rapidly and advertising playing a growing role in local economies, Zenith said. It expects growth in the Africa/Middle East/Rest of World region (mainly driven by the Middle East) and in Central & Eastern Europe to remain in double digits over the 2007-2009 forecast period.

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Sources: MediaLife, AdAge, ZenithOptimedia (pdf).

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