Global Ad Spend to Inch Upwards 0.5% in 2010: Zenith

ZenithOptimedia downgraded its predictions for 2009 and 2010, now saying global ad spending will drop nearly 10% this year, to about $445 billion, down from the 8.5% drop predicted in July.

The new projections for 2009 followed lower than expected figures for the first half of the year, the agency said, adding that the market should hit bottom by the end of 2009. For 2010, global ad growth will be 0.5%, to $447 billion, down from the agency’s previously predicted 1.5%, Adweek reports.

North America will see a 12.6% drop for 2009, to $157 billion, down from the 10.3% it predicted in July. For 2010, North American spending is expected to be down by 4% to $151 billion.

Developed markets will be down 2.9% in 2010, while developing markets will continue to perform well, up 7.8%, ZenithOptimedia said. Developed markets will return to growth in 2011, up 1.5%, according to the agency, the Wall Street Journal writes.

Tim Jones, CEO of ZenithOptimedia, is cautiously optimistic about the future. “I’m sure there will be some more bumps in the road,” he is quoted as saying in AdAge, but added, “I wouldn’t say we’re walking on ice.”

The internet is the only medium expected to grow in 2009, up 9.2%. Television, cinema and outdoor will return to growth in 2010, followed by radio in 2011, Zenith expects. Newspaper and magazine ad expenditure will continue to decline: by 2011, newspaper ad spend will be 25% below its 2007 peak, while magazine ad spend will be 28% below its peak.

Zenith Optimedia’s latest report follows last week’s upgrade by Interpublic’s Magna.

Magna said that some improvement in general economic variables caused it to better its forecast, now saying it expects U.S. ad revenues to decline by 1.3% next year, to about $159 billion, up from the 2.1% decline it had previously expected.

For Q4, total ad revenue will slip 9% from the same quarter in 2008, a significant improvement over the 18% drop seen in Q109 and Q209 and the 13% drop in Q309.

U.S. ad revenues will see a compounded annual growth rate of 1.2% between 2009 and 2014, Magna predicts.