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Recovery expected after worst-ever ad recession - 08-December-2009, 15:50

Recovery expected after worst-ever ad recession
08/12/09

Analysts are forecasting a return to growth next year after the worst TV advertising downturn in living memory. Media buyers ZenithOptimedia and GroupM have both upwardly revised forecasts for TV advertising spend, sparking hope that an end to the unprecedented downturn is in sight.

Across all sectors, 2009 ad spend will be down 10.9% year-on-year in 2009. In the TV sector that equates to global revenues of US$171.5 billion compared with US$185.7 billion a year earlier. However, Zenith forecasts 2009 revenues will total US$174.9 billion, rising to US$182.9 billion in 2011.

The developed markets in the US, Western Europe and Japan will, however, emerge from recession more slowly with Zenith forecasting 2.4%, 0.5% and 3.2% declines respectively next year before a return to positive territory in 2011.

In terms of the overall advertising pie, Internet continues to grab share, but TV is robust and will remain the largest single medium for advertisers. Its overall share of 39.2% in 2009 will increase to 39.7% in 2010 and 40% in 2011. Internet's share will rise from 12.4% to 13.7% and then 14.9% across the same period.

"The worst recession since the Great Depression has caused an advertising downturn unprecedented in modern times," Zenith said. "It is normal for ad expenditure to exaggerate general economic trends; when the economy shrinks, ad expenditure shrinks faster, and by more. The corollary to this is that when recovery is complete , we can expect the ad market to outperform the economy as a whole."



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