ZENITH IMPROVES FORECAST FOR U.S. AD SPENDING GROWTH

To Increase 5.5% for 2004, Citing Olympics, Elections

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NEW YORK (AdAge.com) -- In a quarterly update, ZenithOptimedia bumped up slightly its prediction for 2004 U.S. ad spending growth to 5.5% from 5.1% in an earlier forecast in December 2003.

But after this year's presidential

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election and Olympic Games, ZenithOptimedia predicts U.S. ad spending will slide back to 3.9% growth in 2005 and 4.1% in 2006.

'Fairly average growth'
"It looks like fairly average growth," said Jonathan Barnard, ZenithOptimedia's knowledge management manager. "We're not talking about a surge after the large decline [in ad spending growth] between 2001 and 2003, unfortunately."

The company also cut earlier estimates of 3% growth for 2003, saying U.S. ad spending last year grew less than expected, by just 1.9%.

The quarterly update covered the eight ad markets in Europe, North America and Japan that account for 75% of worldwide ad spending. The eight are forecast to grow 4.2% in 2004, and 3.4% next year, ZenithOptimedia said. The brightest spot is Japan, the world's second-largest ad market. After ad spending growth of just 0.8% last year, ZenithOptimedia forecasts 1.5% growth this year and 2% next year for the country.

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