Campaign India Team
Dec 15, 2014

Warc cuts ad spend forecast, with exception of India and UK

Biggest increase predicted in India at over 15 pc

Warc cuts ad spend forecast, with exception of India and UK
Global advertising spend will increase by 4.8 per cent in 2015 according to Warc's latest International Ad Forecast which has downgraded forecasts for all countries considered except India and the UK.
 
The total market, which covers 12 countries, has been revised downwards by 0.5 per centage points from Warc's June forecast thanks to a combination of factors, including risks to global economic growth presented by further stagnation in the eurozone, slowing growth in parts of Asia and tension surrounding Ukraine.
 
The last of these is a contributing factor in the reappraisal of the Russian market, which had started 2014 brightly with the Sochi Winter Olympics. Economic difficulties have since grown on the back of political uncertainty, the falling price of oil and a devalued ruble. The forecast for 2015 has been slashed by 7.2 per centage points to just 2.0 per cent. When considered at constant 2005 prices that equates to a 4.1 per cent decline.
 
The biggest increases in adspend in 2015 are predicted to come in India (15.1 per cent) and China (10.5 per cent). For the latter, however, there has been a cut of 0.5 per centage points in Warc's forecast, while the former has been revised upwards by 1.6 per centage points on the back of an optimistic economic outlook following this year's general election.
 
Brazil, the last member of the BRIC community, has also experienced deteriorating economic conditions, and adspend there is now forecast to grow at 3.7 per cent in 2015, a reduction of 4.3 percentage points on the June figure.
 
The UK is expected to be the third fastest growing market at 6.9 per cent, unchanged from earlier forecasts. Those for the remaining seven countries considered have all been revised downwards slightly, from -0.1 percentage points in the case of the US to -1.0 in the case of Australia.
 
Looking to the long term, the shift in spend away from traditional channels and towards internet continues. Internet will account for over a third of global adspend next year, up from 9.2 per cent in 2006. By contrast, spend across print media more than halved. Only TV has remained strong over the decade [for traditional media], and is set to remain the largest adspend channel in 2015, taking a global share of 37.1 per cent, up from 35.7 per cent in 2006.
 
Suzy Young, data and journals director, Warc, said, "The outlook for adspend is mixed in 2015, with some markets predicted to see significant growth – while growth in others remains muted. Most advertising dollars will still be spent in mature markets – high annual growth rates in emerging markets notwithstanding. For example, while the Indian ad market is expected to grow rapidly, at an estimated US$6.2bn it will still only achieve a 1.5 per cent market share."
Source:
Campaign India