MobileReport1

Global ad spend shows healthy growth, but varies by market

ZenithOptimedia report shows strong growth in China

Global ad expenditure is set to grow at a healthy 5.4%, according to ZenithOptimedia’s June forecast for ad spending over the next two years.

A surprising change in rankings

“Perhaps the most surprising result for me [in this report] was the rapid change in the rankings of the top ad markets,” said Jonathan Barnard, head of forecasting at ZenithOptimedia’s head office in London. “We now expect China to overtake Japan and take second place this year; we previously thought this would take until 2016. We also think the U.K. will overtake Germany and take fourth place in 2016, an event we never previously predicted.”

Slow and steady

North America, the Middle East & North Africa and what ZenithOptimedia calls “Advanced Asia” (Australia, New Zealand, Japan, Hong Kong, Singapore and South Korea) are still growing steadily at 4% to 5% per year. Japan’s adspend growth also remains persistently slow at 2%.

US still big spender but younger markets catching up

Between 2013 and 2016 the US should contribute 26% of the US$90 billion that will be added to global adspend. China comes second, accounting for 17% of additional ad dollars over this period, followed by Indonesia and Argentina, accounting for 7% and 6% respectively.

Boom in Eastern Europe and parts of Asia

The biggest boom in spending? Eastern Europe/Central Asia, and “Fast-track Asia,” ZenithOptimedia’s category that includes China, India, Indonesia, Malaysia, Pakistan, Philippines, Taiwan, Thailand and Vietnam. These countries are on track to grow 8% to 12% a year.

Bust in Ukraine; bad news in Europe, Russia

The crisis in Ukraine has led to a predicted contraction of a severe 32% this year, while economic sanctions against Russia have weakened growth to 6.9%.

In the “Peripheral Eurozone” (Portugal, Ireland, Italy, Spain and Greece), where recession has caused advertisers to cut back or pull out of the region. Northern & Central Europe have stayed in an adspend holding pattern but “are recently seeing news signs of life,” the report states.

Media Breakdown

TV is still top dog for ad dollars, but internet ad spend is fastest-growing. TV ads pulled in 40% of spend in 2013, nearly twice that taken by desktop and mobile together (21%). And the Winter Olympics, the World Cup and the U.S. elections are expected to continue to fuel growth through 2016.

Television’s share of the global ad spend pie has grown for decades, from 29.9% of spend in 1980 to 39.6% in 2013. But ZenithOptimedia predicts it has now peaked, and will soon begin to decline.

The internet is currently, and perhaps unsurprisingly, the fastest-growing market with a forecasted average of 16% annual growth for 2014 to 2016. Mobile is now the main driver of global ad spend growth, and should contribute 38% of all the extra ad spend between 2013 and 2016. This is excluding markets where ZenithOptimedia doesn’t have a breakdown by medium—i.e. most of Africa. But with an estimated 8 out of 10 Africans now owning mobile phones, this continent is poised to become a player in mobile ad spend in the future.

Media Articles

How Shopify’s IPO could help Ottawa’s tech scene

Nation's capital city boasts twice as technology firms as Waterloo, Ont.

Are Instagram ads paying off?

Results from five Canadian campaigns

Quaker looks to spark Twitter conversations with new effort

PepsiCo brand uses social to encourage Canadians to do more of what matters

Remembering Suzanne Raitt

The industry shares fond memories of Newspapers Canada's VP and CMO

On The Move: Changes at FCB, eBay, Defy and Hill + Knowlton

A weekly recap of who's headed where in Canadian marketing and communications

Ex-CEO of Accuen joins Kik Interactive

Global ad executive will work to build partner ecosystem around social network

Google looks to make YouTube more shoppable on mobile

Viewers will be able to browse products, link directly to retailer's sites from within ad video

Sprint hires Kevin Crull as CMO

Former president of Bell Media to oversee advertising and social media efforts

4 ways to get the media coverage you want

Industry experts share their tips of the trade