GroupM UK forecasts highlights continuing gain for digital in ad budgets

The five main countries behind this, in order, are China, where its forecast has slowed from 10 per cent to eight per cent and ad growth is presently trailing nominal GDP; Brazil, where a big World Cup and election year turned out a little less big; Israel, for geopolitical reasons; Nigeria, reflecting World Cup disappointment, a late start to election campaigning, and natural volatility; and finally Russia, also for political reasons. The USA shows a small drag on the 2014 forecast, with 2014 growth revised down to 3.1 per cent this time from 3.4 per cent in the midyear forecast.

WPP reports that one of the more striking features of this new forecast is the falling dependence on ‘faster-growth’ markets. Comprising around 44 per cent of the world’s economy in 2014, they are still certainly punching above their weight, and slated to contribute 55 per cent to global ad growth this year and 57 per cent next – but this is down from rates in the 70s in the period 2010-2013, peaking at just under 80 per cent in 2013. And another trend which continues intact is digital’s growing appropriation of ad budgets. This continues to gain around two points of share every year, to stand at 24.7 per cent in the new forecast for 2014, and onwards to 27.6 per cent in 2015. 

Print media (newspapers and magazines) have lost ad share at a similar rate for many years to stand at 21 per cent in 2014 and 20 per cent in 2015, but WPP says: “For the first time the forecasts are hinting that traditional TV’s share might finally be falling too, riding a peak of around 43 per cent for the long period 2010-2014, but dropping a point to 41.8 per cent in 2015. This is however heavily influenced by China’s rapid ad migration from TV to digital. It is too soon to call a more general structural change, particularly as legacy TV incumbents are accomplished at retrieving revenues online. But it is a trend we will be watching in the USA and UK in particular.”