WARC cuts 2015 adspend growth forecast to 4.8%

With a growth rate of 15.1%, India is predicted to record the biggest increases in adspend in 2015

BestMediaInfo Bureau | Delhi | December 10, 2014

Warc, the marketing intelligence service, expects global advertising spend (based on 12 major markets) to increase by 4.8% at current prices in 2015, according to its latest International Ad Forecast. This is a downgrade of 0.5pp from its previous report in June. It follows expected growth of 5.5% in 2014.

If inflation is taken into account, global adspend in real terms is expected to rise by 2.4% next year, following growth of 3.1% this year.

The dip in growth rate in 2015 compared with 2014 stems partly from the absence of notable events such as the FIFA World Cup and the Winter Olympics, and partly from risks to global economic growth presented by further stagnation in the eurozone, slowing growth in parts of Asia and tension surrounding Ukraine.

The 2015 outlook for all key markets – with the exception of India and the UK – has been downgraded from June. The US, the world's largest ad market, is expected to post growth of 4.4% next year to reach total spend of $174bn, overtaking 2007's pre-recession peak.

The second biggest advertising market, China, is expected to show internet adspend exceeding a 50% share of total adspend for the first time next year.

Finally, internet (including mobile) will account for over a third of global adspend next year, up from a share of 9.2% in 2006.

Forecast adspend growth in 2015, % change year-on-year

*Constant 2005 price forecasts take into account predicted inflation.

Forecast growth calculated in local currency. Source: Warc's International Ad Forecast

India (15.1%) and China (10.5%) are predicted to record the biggest increases in adspend in 2015, followed by the UK, with estimated growth of 6.9%. Both Russia and Brazil have seen significant markdowns in outlook since June, on the back of deteriorating economic conditions. In real terms, advertising spend is now expected to decline for both markets next year.

12 key countries ranked by 2015 adspend, US$ and % share

Source: Warc's International Ad Forecast

The US, the world's largest ad market, is expected to post growth of 4.4% next year to reach total spend of $174bn, comfortably overtaking 2007's pre-recession peak of $168bn.

Looking to the long term, the shift in spend away from traditional channels and towards internet continues.

Source: Warc's International Ad Forecast

Internet will account for over a third of global adspend next year, up from 9.2% in 2006. By contrast, spend across print media more than halved over the same period. Only TV has remained strong over the decade , and is set to remain the largest adspend channel in 2015, taking a global share of 37.1%, up from 35.7% in 2006.

Suzy Young, Data and Journals Director at Warc, commented: "The outlook for adspend is mixed in 2015, with some markets predicted to see significant growth – while growth in others remains muted.

Most advertising dollars will still be spent in mature markets – high annual growth rates in emerging markets notwithstanding. For example, while the Indian ad market is expected to grow rapidly, at an estimated US6.2bn it will still only achieve a 1.5% market share."

Info@BestMediaInfo.com

Info@BestMediaInfo.com