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Top 100 Global Advertisers See World of Opportunity

Markets Outside U.S. Capture 61% of Spending. New No. 3 Ad Market: China

By Published on . 2

CHICAGO (AdAge.com) -- The United States accounts for 5% of the world's population, 20% of global GDP and 34% of total worldwide advertising, making the U.S. by far the largest ad market. But if you want to reach the remaining 95% of consumers, what do you do? Go global.

The Top 100 global advertisers invested 61% of their measured-media budgets outside the U.S. last year, according to Ad Age's Global Marketers, a study covering 96 countries, territories and regions.

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Explore Ad Age's Global Marketers database, including spending by marketer, country and region
Regardless of their home base, these multinational marketers advertise where they see opportunity for growth.

They are betting big on one country: China. It accounts for 20% of the world's population, 13% of global GDP and -- for now -- just 5% of total worldwide advertising. But ad spending is growing fast. Publicis Groupe's ZenithOptimedia forecasts that China in 2011 will displace Germany as the world's third-largest ad market, coming in behind the U.S. and Japan.

On the Global 100 roster, 10 firms -- including Procter & Gamble Co., L'Or�al, Colgate-Palmolive Co., Coca-Cola Co. and PepsiCo -- allocated more than 10% of 2009 measured-media spending to China.

One global advertiser stands out in China: Fast-food seller Yum Brands (parent of KFC) last year allocated 27% of measured spending to that market and generated 31% of its worldwide revenue from mainland China.

Among the 46 U.S.-based marketers on the Global 100 roster, 12 firms do more than half their ad spending abroad, largely tracking with where they generate revenue and expect to find growth.

Credit: Figures are measured media dollar spending in billions reflecting the primary advertised segment of each company.

Cincinnati-based P&G, the world's largest advertiser, in 2009 invested two-thirds of measured spending abroad; it generated 62% of revenue outside the U.S. in the year ended June 2010. P&G ranked as the No. 1 advertiser in 18 of the 96 measured markets in Ad Age's study.

Unilever, P&G's European rival and the second-largest global advertiser, last year pumped 86% of measured spending into non-U.S. markets, which accounted for 84% of revenue. Unilever scored as top advertiser in 20 of the 96 markets in this study.

Among the 54 non-U.S. companies on the Global 100 list, six marketers -- including four pharma firms -- do more than half of their advertising in the U.S. market. No surprise there; prescription drug advertising is prevalent in the U.S. but not allowed in many other countries. (The other two firms in that group of six were Anheuser-Busch InBev and SABMiller.)

For the Global 100, total measured ad spending tumbled 8.7% to $107.2 billion in 2009, only the second decline on record (after 2001's 2.6% drop) since Ad Age launched the annual study in 1987. U.S. spending for these firms fell 7.2%; the non-U.S. portion dropped 9.6%. Spending was flat or down for 80 of the 100 companies.

Last year's sharp spending decline came amid the global recession; global GDP fell in 2009 for the first time in the post-World War II era.

There were relative bright spots last year. Personal-care ad spending slipped just 1.6%, displacing automotive as the world's largest ad category for the Global 100. Food advertising also fared well, dropping just 1.5%; you've got to eat.

Credit: Source: ZenithOptimedia's Advertising Expenditure Forecasts, December 2010. Its forecast: 4.6% increase in worldwide spending in 2011, vs. 4.9% gain in 2010 and 10.6% drop in 2009. More info: ZenithOptimedia.com. Numbers rounded. Dollar figures for major media spending in 2010 for all advertisers (including Global 100), followed by percent change vs. 2009 spending. In accompanying story, gross domestic product (2009; purchasing power parity) and population (2010) from CIA's World Factbook; U.S. and China shares of 2010 total worldwide ad spending from ZenithOptimedia.
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