Several developing markets are showing rapid growth in ad spending, [pdf] and should continue that pattern through 2013, according to a forecast from Zenith Optimedia. Data shows there are now two developing markets in the world’s top 10 ad markets, China and Brazil, and the addition of Russia will make three in 2013.
No. 3 China Makes Inroads on No. 2 Japan
China is now the third-largest ad market in the world, with spending of $26.1 billion USD in 2010, and is catching up quickly with second-placed Japan, which spent $46.1 billion in 2010. This represents 57% of Japan’s spend. In 2013, China is expected to spend $39.1 billion, 83% of Japan’s predicted $47.4 billion in ad spending. Similarly, Brazil, at sixth place, is even closer to the fifth place UK: 81% of the size of the UK in 2010 and will be 91% in 2013. Russia, which was in 13th place in 2010, will be in ninth in 2013.
Developing Markets Outgrow Established Markets
Developing markets continue to expand far faster than developed markets. ZenithOptimedia forecasts North America to grow by an average of 3.1% a year between 2010 and 2013, and Western Europe to grow by 3.4%. ZenithOptimedia also expect Japan to grow just 0.9% a year, after a big drop in 2011 followed by the recovery of lost ground during the next two years, and it forecasts 0.1% annual growth in the Middle East and North Africa following the same pattern.
Meanwhile, Zenith Optimedia forecasts Latin America to grow by 8% a year, Central & Eastern Europe by 12.4%, Asia Pacific by 7%, and Asia Pacific excluding Japan to grow by 10.7%. Developing markets, defined as everywhere outside North America, Western Europe and Japan, are expected to increase their share of the global ad market from 30.7% in 2010 to 35.1% in 2013.
Developing Markets Will Contribute 62% of New Ad $ in Next 5 Yrs
Zenith Optimedia analysis indicates the sheer size of the US – 3.3 times that of the next-largest market, Japan – means it will contribute the most new ad dollars to the global market over the next three years ($13.8 billion), despite its slow growth. However, the next five largest contributors are all developing markets: China (which contributes almost as much as the US, $13 billion), Russia (US$6.1 billion), Brazil (US$3.5 billion), Indonesia (US$2.8 billion) and India (US$2.6 billion). Overall, Zenith Optimedia predicts developing markets will contribute 62% of new ad dollars over the next three years.
Central/Eastern Europe to Have Highest Rate of Major Media Spend Growth
Forecasting year-over-year regional growth of major media (newspapers, magazines, television, radio, cinema, outdoor, internet) ad spending through 2013, Zenith Optimedia predicts Central/Eastern Europe will have the highest rates, with 9% this year, 13.6% in 2012 and 14% in 2013. The world excluding North America, Europe, Asia Pacific excluding Japan, Latin America, and Middle East/North Africa is expected to follow with respective year-over-year growth rates of 8.6%, 10% and 10.5%.
In contrast, North American year-over-year ad spend growth for the next three years is only respectively forecast to total 2.3%, 3.6% and 3.3%. Although the Middle East/North Africa region is expected to see its ad spend plunge 12.1% in this year of political unrest in the area, it is forecast to rebound to growth rates of 8.9% and 4.7% in 2012 and 2013.
Nielsen: Global Ad Spend Rises 9% in Q1 ’11
Global advertising spend rose 8.8% year-over-year in Q1 2011 to total $118 billion USD based on published rate cards, according to Nielsen Global AdView Pulse data. Nielsen analysis indicates heavier TV spending, as well as increased investment in the Latin American and Asian consumer markets, drove growth.