China and US slowdown prompts Warc to slash ad spend forecast to 2.3%

A slowdown in China and the US – the world’s two largest advertising markets – has prompted ad research group Warc to slash its ad spend forecast from 4.8 per cent to 2.3 per cent for 12 of the world’s major markets this year.

China’s ad industry is expected to grow by nine per cent this year at current prices  – down 1.5 percentage points year on year – while the US is reckoned to cool by 1.4 per cent, a fall of three percentage points.

Source: Warc

Forecast ad spend in 2015, source: Warc

While India is powering ahead with 16 per cent growth this year, year on year the country’s rate of growth is just one per cent.

Ad spend forecast growth in 12 major markets

By medium, TV is expected to see a decline – thanks largely to a lack of major sporting events and a weak upfront advertising sales period in the US – of 1.9 per cent, while the internet will surge by 16 per cent.

Source: Warc

Ad spend in 2015, Source: Warc

The internet, which is already a large ad medium in six of the 12 markets, is expected to be the biggest advertising medium in these countries by 2016.

Source: Warc

Ad spend in 2016, Source: Warc

James McDonald, data analyst at Warc, commented: “After a strong rise in global advertising spend last year, the outlook for 2015 is more sobering. With three of the world’s largest economies now in recession, and slowdowns seen in the US and China, we expect a degree of caution when it comes to committing ad budgets this year.

“That said, advertisers have increased spend every year since the 2009 crash, with the influx of money for internet ads underlining the growing range of options for marketers,” he said.


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