Advertising expenditure will grow by 20% this year to reach $84 billion, according to Zenith’s Advertising Expenditure Forecasts.
At the same time, the combined advertisers’ expenditure on newspapers and magazines will fall by 6% to $69 billion.
Social media will be the third-largest channel for advertising this year, with a 13% share of global ad spend, behind TV (29%) and paid search (17%). However, its growth is slowing as it matures, and is forecast at 17% in 2020 and 13% in 2021, when it will account for 16% of all global ad spend. ?
Commenting on the forecast, Matt James, Zenith’s global brand president, said: “Social media advertising gives brands the opportunity to drive growth by using automated tools to optimise their campaigns for key business objectives.
“By using first-party data from their own websites to identify potential customers on social media, brands can convert consumers who are already on the path to purchase and target look-a-like audiences more effectively.”
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Zenith notes that paid search advertising will exceed $100 billion for the first time this year, reaching $107 billion by the end of 2019. Paid search is growing at 8% a year and will amount to $123 billion in 2021, when it will account for 18% of total ad spend. TVn advertising continues to suffer from shrinking ratings in key markets, and will slip from ? $182 billion in 2019 to $180 billion in 2021, accounting for 27% of total ad spend in the latter year.
Zenith also notes that the US market is now the source of nearly half of global ad spend growth. It will contribute 48% of new ad dollars this year, and 46% between 2018 and 2021.
In addition, it has downgraded its forecasts for Europe as poor economic performance in key markets has eroded advertiser confidence. Ad spend growth will now amount to 1.9% in Western Europe (as opposed to 2.4%) and 4.7% (6.1%) in CEE.
Ad spend growth is also slowing in Asia Pacific, with 4.4% growth forecast for 2019, after 6.9% growth in 2018.
Overall, Zenith forecasts that global ad spend will grow by 4.4% this year to reach $640 billion, down slightly from the 4.6% forecast made in June.
Growth is expected to remain stable at 4.3% in 2020 and 4.4% in 2021, as compared to the June forecast of 4.4% growth in 2020 and 4.3% in 2021.
