Mobile to drive global adspend growth over next 3 yrs: ZO

10 Dec,2013

By A Correspondent


Advertising is set to see the strongest sustained period of growth in 10 years with global adspend growth forecast to rise from 3.6% in 2013 to 5.3% in 2014. Growth is then set to increase to 5.8% in 2015 and 2016. The principal engine of this growth will be mobile technology, which is expanding the space for media consumption.


According to ZenithOptimedia’s new Advertising Expenditure Forecasts, growth in global adspend next year will come from the continued steady improvement in Europe and the three ‘semi-quadrennial’ events: the Winter Olympics, the football World Cup, and the mid-term elections in the US. We forecast that the global advertising market will accelerate to 5.8% in 2015 as a strong broad-based economic growth takes hold, followed by another year of 5.8% growth in 2016. This assumes that the Eurozone’s gradual recovery continues and no new crisis occurs.


Mobile is expanding overall media consumption

Mobile is now the main driver of global adspend growth. This the first time in the past 20 years that a new platform is expanding overall media consumption without cannibalising any of the other media platforms. We forecast mobile to contribute 36% of all the extra adspend between 2013 and 2016. Television is the second largest contributor (accounting for 34% of new ad expenditure), followed by desktop internet (25%), which continues to enjoy significant growth alongside that of mobile advertising.


Despite its sizeable growth, mobile advertising still only accounted for 2.7% of global adspend in 2013. By 2016, however, we expect it to account for 7.7% of adspend, leapfrogging radio, magazines and outdoor to become the world’s fourth-largest medium. We count as mobile all internet ads delivered to smartphones and tablets, whatever their format.


Rising Markets are growing three times faster than Mature Markets

The world’s ad markets are growing at two very different paces. Mature Markets are struggling with debt and low innovation, and their populations are ageing, with growing numbers of retirees supported by a shrinking workforce. We forecast these markets to grow at an average of just 3% a year between 2013 and 2016. Meanwhile Rising Markets are improving their education systems, infrastructure, productivity and adoption of technology, and they have a young population with an expanding workforce. We expect them to grow at 9% a year. The Rising Markets currently account for 35% of global adspend, but we expect them to contribute 61% of adspend growth between 2013 and 2016.


BRIC growth is slowing

The G7 markets (Canada, France, Germany, Italy, Japan, the UK and the USA) have a median age of 40; they account for 58% of global adspend, but we forecast them to grow at an average annual rate of only 3.6% between 2013 and 2016. The BRICs (Brazil, Russia, India and China) have grown enormously over the last twenty years, and now account for 14% of global adspend, up from 1% in 1993. They are much younger than the G7 (with a median age of 31), and we forecast them to grow at an average of 9.5% a year over the next three years, but this is well down on their average growth of 15.8% in the previous decade.


“Mobile technology is creating new opportunities for marketers to connect with consumers. Combined with the continued rise of young, dynamic markets, this will spur healthy and sustained growth in global adspend over the next three years,” said Steve King, ZenithOptimedia’s CEO, Worldwide.


ZenithOptimedia is headed by Anupriya Acharya in India.


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