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GroupM Revises Global 2013 Ad Spending Forecast Downward to 3.4% Growth 

NEW YORK—GroupM today revised its biannual worldwide measured advertising spending forecast for 2013 downward to $507 billion reflecting a 3.4 percent growth rate compared to the 4.5 percent rate predicted in December of last year.

The revised forecast was published in “This Year, Next Year,” which also included a final tabulation for 2012 revealing advertising spending in measured media hit $490 billion, a 3.6 percent increase over spending in 2011.

Also, in its first prediction for 2014, the 75-country forecast predicted that global ad spending will increase 5.1 percent compared to 2013, representing $533 billion. It was prepared by GroupM Futures Director Adam Smith and released today.

For the U.S. market, the report said advertising investment in measured media would grow only 1.8 percent in 2013 to $156 billion, up from $153 billion in 2012.  For 2014, the forecast is a 2.9 percent hike in spending to $161 billion.

“We estimate marginal growth in advertising spending in 2014 on a comparable component basis,” said Rino Scanzoni, GroupM’s Chief Investment Officer for North America.  “However the Sochi Winter Olympic games will add an additional 50 basis points to the growth rate with funding coming primarily from existing budgets.”  

Regarding worldwide spending, Smith said the downward revision to growth in 2013 ad spending could be attributed primarily to continued economic discord in the Eurozone—the same reason that led GroupM to revise its 2012 forecast downward.

“The Eurozone periphery, specifically Italy, Spain, Portugal, Greece and Ireland, is once again the main reason for the decline,” Smith said.  “Stabilization is elusive. We now expect this group to record an 11 percent fall in measured advertising in 2013.”

The revised forecast for Western Europe predicts a 2.4 percent decline in spending compared to 2012 to $97 billion. Spending in 2014 is expected to rise only 1.8 percent to $99 billion.  Smith added that the Eurozone periphery accounted for 7 percent of global advertising investment before the economic crisis and now accounts for only about 3 percent although this group's nominal GDP changed little during the same period.

The study is part of GroupM's media and marketing forecasting series drawn from data supplied by parent company WPP's worldwide resources in advertising, public relations, market research, and specialist communications.

DIGITAL SPENDING REMAINS STEADY

The report predicted that investment in digital media would account for 19 percent of measured ad spending globally this year ($95 billion). For 2014, digital ad spend is expected to rise by 14 percent to occupy a 20 percent share of ad budgets.

HOTSPOTS

Within the industrializing world, China's preeminence as an advertising rainmaker looms ever larger, this year raising 40 percent of net new global investment, according to the report.  At the same time, there is similar support for sustained advertising growth in Russia.

“Western advertisers' share of investment in both countries remains as substantial as ever, and is even rising, according to standard industry monitoring sources,” Smith said.

A copy of the full report is available to the media upon request.

Media USD m, current prices

 

2012

2013f

2014f

NORTH AMERICA

166,338

169,378

174,158

yoy %

3.4

1.8

2.8

LATIN AMERICA

32,074

34,837

37,838

yoy %

5.3

8.6

8.6

WESTERN EUROPE

99,554

97,133

98,893

yoy %

-4.0

-2.4

1.8

CENTRAL & EASTERN EUROPE

19,064

20,430

22,113

yoy %

6.5

7.2

8.2

ASIA-PACIFIC (all)

155,127

166,359

179,947

yoy %

7.6

7.2

8.2

NORTH ASIA

80,362

87,900

97,579

yoy %

10.7

9.4

11.0

ASEAN

12,464

13,728

15,355

yoy %

11.2

10.1

11.9

MIDDLE EAST & AFRICA

18,004

18,884

19,901

yoy %

12.6

4.9

5.4

WORLD

490,161

507,021

532,849

yoy %

3.6

3.4

5.1

 

Media yoy% adjusted for CPI

 

2012

2013f

2014f

NORTH AMERICA

1.4

0.0

1.1

LATIN AMERICA

0.4

4.0

4.2

WESTERN EUROPE

-6.0

-4.1

0.0

CENTRAL & EASTERN EUROPE

-0.2

0.1

2.6

ASIA-PACIFIC (all)

5.3

4.5

4.2

NORTH ASIA

7.9

6.2

7.8

ASEAN

6.0

5.3

6.7

MIDDLE EAST & AFRICA

5.0

-1.7

0.0

WORLD

1.0

0.8

2.1

 

ABOUT GROUPM

GroupM is the leading global media investment management operation. It serves as the parent company to WPP media agencies including Maxus, MEC, MediaCom, and Mindshare.  Our primary purpose is to maximize the performance of WPP’s media communications agencies on behalf of our clients, our stakeholders and our people by operating as a parent and collaborator in performance-enhancing activities such as trading, content creation, sports, digital, finance, proprietary tool development and other business-critical capabilities. The agencies that comprise GroupM are all global operations in their own right with leading market positions. The focus of GroupM is the intelligent application of physical and intellectual scale to benefit trading, innovation, and new communication services, to bring competitive advantage to our clients and our companies.

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