Following 3.8% growth in 2011, global advertising spending is expected to grow by 4.9% in 2012 to $465.5 billion, according to the latest Global Advertising Forecast from Strategy Analytics.
The U.S. ad spend will increase by just 2.7% compared to that global 4.9%. still, that beats 2011’s meager 0.6% growth. The U.S. will trail Europe as well, where ad spending is expected to grow by 3.7% to $136.3 billion in 2012.
Not a bad picture, globally. Ed Barton, Strategy Analytics’ Director of Digital Media Strategies, chalks the gains up to such major global-impact events as—
- The Summer Olympics
- The U.S. presidential elections
- The European Football Championships
- Japan’s continued recovery from the earthquake
Global Advertising by Media Type
Looking at spend by media type reveals that global TV advertising is expected to grow by 5% in 2012 to $188.5 billion, equivalent to 40% of all global spending. Global print advertising is expected to grow by 0.5% to a 26.4% share. Other traditional formats including cinema and radio will grow by approximately 4%.
By contrast, global online advertising is expected to grow 12.8% to $83.2 billion and 18% of global ad spending. Barton says, “Online advertising will continue along its growth trajectory fuelled by strong growth in emerging markets and increased spending volumes on social networking and online video advertising.”
U.S./Europe Advertising by Media Type
Online spending will lead in terms of growth in the US: online is expected to grow by 6.7% this year to $27.4 billion, versus 3.7% for TV and 2.9% for other traditional formats. Print is expected to decline by 1.5%.
In comparison, online advertising across Europe is expected to grow by 11.7% this year compared to 3.4% for TV and 2.4% for ‘other traditional’ advertising. Print is expected to decline by 0.1%.
Still says Barton, the U.S. will continue to lead the world in the share of revenue generated by TV advertising, which this year will be approximately 41% compared to 35% in Europe and 24% in the UK. Internet ad growth lags the world, but, will overtake print ads in 2016, a year ahead of the global market.
One caveat: “The [Eurozone] is one defining incident away from all forecasting outlooks…being rendered irrelevant,” says Barton. One natural disaster or economic collapse could shatter spending in a region of unsustainable national and household fiscal deficits.
A second caveat: this forecast does not include mobile advertising in online advertising. Mobile advertising is forecasted to reach $2.61 billion in the US in 2012, alone, representing 47% growth over 2011. At nearly 10% of the $27.4 billion projected for other online ad spend with its 6.7% projected growth, mobile stacks up very well.
Sunset for Print
As Leika Kawasaki, an analyst at Strategy Analytics's digital media strategies practice told DMNews, “Advertising is moving to online. We see clear online growth over traditional print advertising, which is shrinking in the US.” Kawasaki sees no major shifts in the role of print ads, as the “watershed” has already occurred: the shift of classifieds and locally-targeted campaigns to online advertising.
Thus, “Print spending in newspapers tends to be dominated by retailers looking to drive store traffic,” which too will continue to erode in the U.S. where print readership continues to decline.
