Ad spending expected to see slower growth in 2019

Three top ad forecasters—GroupM, Magna Global and Zenith—say ad spending next year will see slower growth than 2018 and one predicts that digital spend might finally be slowing down. GroupM, WPP's media investment group, is downgrading its initial 2018 growth expectations from 4.5 percent to 4.3 percent in a report to be released this week. It's also reducing its 2019 growth projections from 3.9 percent to 3.6 percent. The media agency company says this is due, in part, to stress in the auto category and continuing softness in the consumer packaged-goods category. Magna is forecasting that global advertising in 2019 will grow for the 10th consecutive year but says the growth rate will slow to 4.7 percent due to the absence of major cyclical events—though that's higher than its initial forecasts. It says global advertising revenues grew by 7.2 percent this year to reach a total of $552 billion in the 70 countries analyzed by Magna. That was buoyed, it says, by the FIFA World Cup in Russia, midterm elections in the U.S. and the Winter Olympics in South Korea, which together generated $6 billion in incremental ad spending. For next year, Magna forecasts a "moderate slowdown" for advertising growth in the U.S., according to Vincent Létang, Magna's executive VP of global market intelligence. The IPG Mediabrands company also forecasts digital advertising growth will lose some momentum in 2019, growing only 13 percent as compared to 17 percent in 2018. But that might be due to saturation: Digital media sales are forecast to represent nearly half of global ad dollars next year, Magna says. "As far as we're concerned, this symbolic milestone will be achieved in 2019 or 2020 at the latest," says Létang. Magna forecasts good news for TV, saying that national TV in the U.S. continues to notch price increases that stabilize its revenue. "They have 10 percent less apples to sell, but they manage to sell them 10 percent higher every year because the demand is there," says Létang. "U.S. television is very expensive, but marketers in pharma, CPG and a lot of verticals find that still it's worth it so far." Publicis Groupe's Zenith predicts global ad expenditures to grow 4.5 percent by in 2018, reaching $581 billion by the end of the year. It predicts 4 percent growth for 2019, down slightly from its September prediction of 4.2 percent growth. Zenith credits online video and paid search as driving the growth as advertisers are focusing on personalized, targeted communications. Zenith says online video advertising will grow at an average of 18 percent a year between 2018 and 2021, twice as quickly as other forms of internet display advertising.

Ad spending expected to see slower growth in 2019

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