Slow but steady growth in global ad spend is being hindered by a lack of recovery in Western Europe, according to new figures.
Worldwide advertising investments are expected to hit the dizzy heights of $534 billion this year as the industry welcomes a 4.5% uplift on spend from 2013. Fresh insights from global media investment firm GroupM laud the efforts of China, the US and emerging countries such as Nigeria and Kenya in boosting this total, while bemoaning sluggish progress across some of the more mature markets in Europe.
Ireland, Greece, Spain and Italy, all of which have been forced to endure financial hardship in recent times, are keeping ad spend within the Eurozone at 20% below its 2007 peak. By comparison, forecasts suggest the worldwide market will hit $560 billion in 2015, finally exceeding levels witnessed in 2007, just before the recession crippled economies across the globe.
It is not all doom across Western Europe, however, which remains the most digitised ad region in the world. Unfortunately a lack of financial stability across certain areas seems to be forcing advertisers to consider whether any digital messages they do send out will be acted upon.
Recent events have encouraged them to channel spend into other countries, such as India, Brazil and Russia, which remain the fastest growing ad markets worldwide.
China also received extensive coverage in GroupM’s This Year, Next Year report, which praised the country for its acceptance of digital ad formats.
“Despite the slowdown in China’s general economy from 2012, its consumer economy continues to expand. This, plus intensive digitisation of advertising, keeps China’s ad investment rising at or near double digits, with no large print legacy to correct,” stated This Year, Next Year report editor Adam Smith.
Playing catch up
With a post-recession recovery firmly in sight, the global ad market will now look to claw back some of the economic power it lost following the dotcom boom. Ad spend accounted for 0.9% of global GDP in 2000, but new GroupM has its current contribution at 0.7%.
Growth in digital ad spend will prove imperative to the wider industry’s success as it rises to account for 23.6% of all advertising investment in 2015.
TV is expected to represent most of the remaining total, based largely on its current market share of 44%.