GroupM projects ad growth accelerating to 4.5 percent to yield US$534 billion despite the rise in geopolitical tension, firm oil prices, and the possibility of tighter money.
GroupM’s Worldwide Media and Marketing Forecasts report, This Year, Next Year, reports that growth in the world economy slowed a little in 2013, and so did advertising, the year recording a modest 3.5 percent increase in measured global ad investment to stand at US$511 billion at today’s exchange rates.
This has been a slow recovery, but the forecast for 2015 envisages global ad investment finally passing its 2007 peak in real terms. This milestone is however still not in prospect for the more mature markets of North America, Europe and Asia, which, though mostly growing, remain collectively well below 2007 in real terms now and forward to 2019 according to GroupM’s extended forecast model.
It is the minority of younger advertising economies which are pulling the world over the line: for these, there was no ad recession, only a brief pause in growth in 2009.
Global ‘ad intensity’ – advertising’s percentage of GDP – has fallen throughout, from a recent peak of 0.90 percent in the dotcom boom of 2000 to 0.72 percent today. It has remained stable only in the fastest-growing regions. This is in part the result of advertising investment migrating from mature economies, where the ratio is higher, to the younger. The mature world occupies 64 percent of today’s ad investment and the younger world 36 percent, the latter steadily winning a point each year.
Digital’s share meanwhile continues its steep ascent, accounting for a forecast 21.6% of measured ad investment in 2014 and 23.6 percent in 2015. Advertising, commerce, technology and consumer behaviour all catalyse the medium with equal vigour in new and old worlds alike – and no more so than in China, where digital already approaches a third of measured ad investment. In 2014 and 2015, GroupM expects digital to furnish 63 percent of incremental ad dollars worldwide (with TV supplying most of the rest).