Carat’s latest Global Ad Spend Report forecasts 4 per cent global ad spend growth in 2015 at $529 billion, a slight decline from the 4.6 per cent predicted in March 2015; 2016 is predicted to grow by 4.7 per cent
BestMediaInfo Bureau | Delhi | September 22, 2015
The year 2015 looks set to be a buoyant year for the Indian advertising market, according to Carat’s latest Global Ad Spend Report. Optimism continues to flood the Indian market as growth prospects in the country remain high, propelled by the election of a pro-business government in 2014 and the revival in investment. Double digit growth is forecast for the advertising market in India – the highest growth rate of the BRIC markets – in 2015 of +11.0 per cent, boosted by the ICC Cricket World Cup, and a growth rate of +12.0 per cent in 2016.
Ashish Bhasin, Chairman & CEO, Dentsu Aegis Network - South Asia, said, “Carat’s latest estimate show that in India we should see a healthy growth of 11 per cent in ad spends. We see the scenario improving even further next year and hence, have revised the 2016 growth rates to 12 per cent.”
Markets continuing to grow at double digits in 2015 and 2016 in the Asia Pacific region are: India at +11.0 per cent in 2015 and +12.0 per cent in 2016, Philippines at +10.2 per cent in 2015 and +12.3 per cent in 2016, and Vietnam at +11.3 per cent in 2015 and +13.5 per cent in 2016.
Based on data received from 59 markets across the Americas, Asia Pacific and EMEA, Carat’s latest global advertising expenditure forecasts that global advertising spend will grow by +4.0 per cent in 2015 to $529 billion, a slight decline from the +4.6 per cent predicted in March 2015, and 2016 is predicted to grow by +4.7 per cent, accounting for an additional $25 billion in spend.
Fuelled by the rise of Mobile and Online Video spending trends, Carat’s latest forecasts reconfirm the continued solid growth for digital media, evident through the upsurge in the predicted share of advertising spend in 2015 of 24.3 per cent and 26.5 per cent in 2016. For 10 of the markets analysed, including the UK, Ireland, Canada and Australia, digital is now the principle media used based on spend, with the US market predicted to join this list in 2018, when digital advertising spend is forecast to overtake TV advertising by more than $4 billion.
From a regional perspective, Carat confirms ongoing positive momentum in 2015 for most regions although volatility occurs in some individual markets, with Western Europe at +2.6 per cent, +4.2 per cent in North America, +4.1 per cent in Asia Pacific and +12.7 per cent in Latin America. Despite a slight decline in growth forecasts due to China’s economic downturn, Asia Pacific remains strong in 2015 with an above global spend rate of +4.1 per cent, driven by high-performing India at +11 per cent and growing Australia at +2.4 per cent. Carat’s data also reports an encouraging outlook for 2016, with all regions predicted to increase year-on-year spend next year and Central & Eastern Europe to return to positive growth.
By media, digital continues to be the only channel warranting double digital growth, predicted at +15.7 per cent in 2015 and +14.3 per cent in 2016. This is driven by the high demand for mobile and online video advertising, especially across social media, with +51.2 per cent and +22 per cent year-on-year growth expected this year. Programmatic buying is also experiencing rapid growth at a rate of +20 per cent each year. TV remains resilient with a steady 42.0 per cent market share in 2015 and is predicted to grow by more than +3 per cent in 2016, as the upcoming Olympic Games and US elections are expected to drive considerable viewership. Despite the ongoing decline in print spend, Carat’s forecasts confirm year-on-year growth for all other media with updated predictions for 2015 highlighting year-on-year growth in cinema at +4.7 per cent, radio at +1.3 per cent and outdoor at +3.4 per cent, with the latter two slightly revised down from March 2015 figures.
• Accelerated global advertising spend growth predicted in 2016 of +4.7 per cent, in line with higher global economic growth expectations for next year and boosted by the quadrennial events.
• Global advertising spend forecasts for 2015 have been revised down from the +4.6 per cent previously forecast in Carat’s Advertising Spend report in March 2015 to +4.0 per cent following significant changes to regional advertising forecasts in Central & Eastern Europe and Asia Pacific, due to dampened expectations in major markets Russia and China.
• Western Europe remains stable with consistent year-on-year growth at +2.6 per cent in 2015 and +2.9 per cent in 2016 driven by positive momentum in the UK and Spain.
• North America’s growth in 2015 is predicted at +4.2 per cent in 2015, marginally above the global average of +4.0 per cent, and estimated at $203.3 billion.
• In Asia Pacific, the Indian advertising market is buoyant as growth prospects in the country remain high at +11.0 per cent in 2015 and +12.0 per cent in 2016.
• Digital media spend is still predicted at double digit growth levels of +15.7 per cent in 2015 and +14.3 per cent in 2016, matching and exceeding previous predictions respectively in the March 2015 report despite the reduction in the overall growth forecasts. Digital’s share of total advertising spend continues to expand year-on-year, targeting a forecast of 24.3 per cent in 2015, rising further to 26.5 per cent in 2016, exceeding predictions from the March 2015 report.
• Digital’s strong growth trajectory is driven by online video, programmatic and mobile. By the end of 2015, US market programmatic transactions will account for 52 per cent of non-search digital advertising spend, with growth at a rate of circa 20 per cent a year predicted to continue for the next few years. Overall, mobile is experiencing the greatest spend growth across all media and Carat predicts year-on-year growth in mobile spend at +51.2 per cent in 2015 and +44.5 per cent in 2016.
• TV still remains the dominant medium globally with a predicted 42 per cent share of total advertising spend in 2015.