Media network Carat has published its updated forecasts for worldwide ad expenditure, showing a positive outlook for the global market in 2016 and a relatively rosy picture for 2017, powered by digital.
Based on data from 59 markets across the Americas, Asia Pacific and EMEA, the latest forecast predicts that advertising spend will reach S$548.2 billion in 2016, 4.4 per cent year-on-year growth. The healthy outlook has been fuelled by high-interest media events including the UEFA EURO championship, the Rio 2016 Olympics and Paralympics, as well as the upcoming US presidential elections.
In 2016 Carat reports a positive outlook for most regions with particularly robust growth in North America (five per cent up) and strong recovery in Russia (6.2 per cent), countering lower expectations in some markets. The US continues to show positive market confidence with forecasts revised up as the US presidential elections alone are expected to generate $7.5bn of incremental spend.
Despite a slight moderation following the EU referendum, the UK continues to be the largest advertising market in Western Europe, with positive growth of 5.4 per cent expected in 2016, exceeding the average rate of 2.9 per cent in Europe as a whole. Advertising is also set to remain strong in Latin America and Asia Pacific, with ten per cent and 3.9 per cent growth respectively in 2016, in spite of Brazil’s lower expectations and China’s adjustments to its ‘new normal’ economic landscape.
Despite a slight decline due to volatility in some markets, the positive momentum of the global advertising spend is expected to continue into 2017 reaching $570.4 billion, four per cent year-on-year growth, led by digital media. As the leading media type in 13 of the markets analysed, digital continues to grow at double-digit levels of 15.6 per cent in 2016, slipping a little to 13.6 per cent in 2017. Driven by the high demand for mobile, online video and social media, digital media spend is expected to reach a 27.7 per cent share of total global media spend in 2016, increasing to a predicted 30.2 per cent in 2017.
This still leaves it behind TV which has the highest share of total media spend of 41.1 per cent in 2016. TV is expected to grow at a more moderate rate of 2.3 per cent in 2017 with a lower predicted share of spend at 40.3 per cent.
Print advertising’s decline is forecast to continue, down by 5.5 per cent in 2016 and 4.3 per cent next year. Carat forecasts year-on-year growth for all other media in 2016: cinema up 4.5 per cent, radio up 2.4 per cent and out of home 3.5 per cent, with predictions revised down slightly for 2017.