US media industry advertising revenues will grow by 3.1% during 2011, excluding the impact of political and Olympic advertising, according to [pdf] new estimates from MagnaGlobal. This figure is in line with MagnaGlobal’s revised ad revenue growth rate estimate for 2010, which it expects to be similar.
Total Ad Revenues Expected to Reach $173B
Total advertising levels remain below those observed in the recent peak (pre-recession) year of 2006, with MagnaGlobal projecting the industry’s size likely to equate to $173 billion in revenues this year. Including the impact of political and Olympic advertising, MagnaGlobal expects total advertising will only grow by 1.9% during 2011, less than half the 4.3% expected for 2010.
Print Declines as Digital Grows
MagnaGlobal analysis indicates reported totals are held back by deep structural weakness in printed media, which weakens with every passing quarter. MagnaGlobal predicts newspapers, magazines, directories and direct mail will likely decline by 2.9% during 2011.
By contrast, digital and broadcast media continue to grow rapidly, as does the outdoor business. MagnaGlobal estimates digital, TV, radio and outdoor collectively will grow by 6.9% during 2011.
Mobile Expected to Grow 60%
There are many new platforms growing at even faster rates, according to MagnaGlobal. For example, data shows interest in mobile advertising has been catalyzed among large advertisers during the past year, and MagnaGlobal expects growth of 60.1% during 2011.
In addition, online video has achieved meaningful scale, and is now commonly used by a wide range of advertisers. Therefore, growth is expected to approximate 26.8% this year. Emerging outdoor media will also outpace the rest of the outdoor industry as inventory is increasingly monetized; MagnaGlobal expects the subsector to grow by 17.4%.
Traditional TV Still Strong
Alongside these digital and mobile advertising trends, MagnaGlobal predicts that traditional TV and older forms of digital media will continue to grow rapidly. MagnaGlobal expects TV advertising to rise by 6.3% on a normalized basis during 2011 and digital display to grow by 11.6%. Paid search is also expected to fare well, rising by 11.1% during the same period.
TV Media Paces 2010 Ad Recovery
Television media continued to pace the 2010 advertising recovery during the first nine months of the year, according to data released by Kantar Media. While overall TV ad revenues grew 10.5% from the first nine months of 2009, spot TV expenditures surged 27.8% behind what Kantar terms a swell of political advertising and sustained demand from automotive marketers and retailers.
About the Data: MagnaGlobal’s forecasting model includes detailed data for more than 40 types of media on a quarterly basis from 1990 to 2011 and on an annual basis from 1980 to 2015.
