NEW YORK (AdAge.com) -- Ad spending will grow next year, albeit by less than a single percentage point, according to two new forecasts being released today.
Global ad spending will decline 10.2% in 2009 when the year is complete but eke out a 0.9% increase in the coming year, according to Publicis Groupe's ZenithOptimedia, which will present its forecast Dec. 8 at the 37th annual UBS Global Media and Communications Conference in New York.
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ZenithOptimedia had previously said it expects a slightly smaller rise of 0.5% next year. "This is our first upgrade to 2010 since we published our forecasts in June 2008, just before the full extent of the financial crisis became clear and the advertising downturn began," ZenithOptimedia said in its forecast.
Ad spending in the U.S. is still due for a harsh 12.9% drop in 2009, however, and another 2.6% decline in 2010, according to the forecast. Western Europe will similarly see ad spending fall 11.8% this year and 0.5% next year, while Latin America posts gains this year and next. "The pain inflicted by the ad downturn has been distributed across the globe very unevenly," ZenithOptimedia said.
It's also affected different media differently. "The internet is the only medium that has grown this year," ZenithOptimedia said. "The downturn has accelerated the structural shifts of budgets from traditional media to the internet; in a time when marketing departments have to justify every dollar they spend, the rapid and clear returns offered by internet advertising are more attractive than the longer-term brand building benefits offered by other media."
The internet will overtake newspapers as the world's second-largest ad medium by halfway through the coming decade, according to ZenithOptimedia.
WPP's Group M, meanwhile, is projecting a 6.6% drop off to $445 billion in global ad spending in measured media in 2009, which will be followed by a slight positive bounce of 0.8% to $448 billion in 2010. That's an improvement over the media group's earlier prediction of a 1.4% decline in growth next year.
According to the "This Year, Next Year" report, which Group M will also present today at the UBS conference, the so-called BRIIC nations -- Brazil, Russia, India, Indonesia and China -- will lead the recovery in ad spending while the U.S. and Western Europe play catch-up. The 70-country outlook forecasts ad expenditures will drop by 8% in the U.S. this year followed by a 4.3% drop off in 2010.
Its long-range model anticipates that global ad revenue growth will return to annual growth in the 6% to 7% range from 2011-2014, which is roughly a point ahead of expected nominal global GDP growth.