Datawatch: Advertising's online, globilised future in numbers

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Jasper Jackson, TheMediaBriefing Experts' Blog, Advertising

No one has a crystal ball in advertising but you could do worse than pay attention to figures from ZenithOptimedia and Group M, the media buying arms of two of the world's largest ad agencies, WPP and Aegis.

Last week both released their most recent forecasts for 2013 and beyond -  what they predict is a milestone for online advertising and a difficult time for Western Europe. 

Online overtakes newspapers

The big news is that Zenith expects total online spend to outstrip newspaper advertising globally for the first time next year, growing from $88.6 billion (£55.2 billion) this year to $101.4 billion (£63.2 billion) in 2013, as newspaper ad spend falls $900 million to $91.3 billion (£56.9 billion) in 2013. 

Group M doesn't provide a break out for newspapers in its forecast, but it is predicting online ad spend to grow from 19.5 percent of ad spending globally this year to 21.4 percent in 2013 to hit $114 billion (£71.1 billion). It's safe to say both firms see online as a bigger slice of the ad pie than newspapers from 2013 onwards.

Zenith predicts internet spending to be by far the biggest contributor to global ad spend growth, accounting for 59 percent between 2012 and 2015. As you can see from the graph below, TV is the only other big growth area, and while it remains worth far more than any other medium, it isn't growing as fast as online.

This is what Zenith predicts the split between different formats will look like next year. 

Within online ads, Zenith sees display growing rapidly to $57 billion (£35.5 billion) through to 2015, but not rapidly enough to overtake paid search, which will remain the biggest part of the online ad market worth more than $61 billion ($38 billion) in 2015.

Western European blues

The below graphs show ad spend estimations from each company for 2011, 2012 and 2013. As you can see, both Group M and Zenith are predicting rises in ad spend between 2011 and 2013 in each region, except Western Europe.

Both predict that by the end of this year that Western European ad spend will be down more than 2 percent on 2011, and growth between 2012 and 2013 will be tiny.

-- Group M predicts a 0.6 percent increase for the region to $103 billion (£64.2 billion) in 2013, while Zenith puts the 2013 figure at $108 billion (£67.3 billion), up just 0.2 percent on 2012.

-- That compares to an average growth rate of around 4.5 percent globally.

-- Zenith does predict growth in ad spend will pick up in Western Europe after 2013 to hit a rate of 2.2 percent in 2015, but it will still lag well behind the rest of the world. Even North Africa and the Middle East will see growth in 2015 of 2.47 percent.

As you can see from graphs below, Zenith predicts the share of global ad spend in Europe will have dropped from 22.7 percent to 19.4 percent by 2015. Group M predicts that figure will fall to as low as 17 percent by 2017.

Image via flickr curtousey of michaeltk

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