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India and China are the bright sparks in an otherwise gloomy auto ad spend forecast from Zenith

Media agency Zenith has launched its automotive advertising expenditure forecasts which predict tough times for the industry. According to Zenith’s estimates, ad expenditure by auto brands will grow by 0.8% through 2019, a fall from 1.5% in the previous year.

The notable exceptions to the decline are India and China.

India is the fastest growing market when it comes to auto ad spend. Zenith expects spends in the country to grow at an average of 12.8% a year till 2020.

In China too, auto ad spend has clocked a healthy growth of 47% between the period 2012 to 2018.

In the same period, auto ad spend declined by 12% in the United States, the world’s largest auto market. The US accounted for $18 billion in auto ad spends in 2018.

It was almost thrice as much as the ad spend of China, at $6.3 billion for the same year.

Globally, auto ad spend is expected to pick up only in 2020 and grow by 2% thanks to the Olympic games in Tokyo and UEFA Euro 2020 football championship.

The reasons cited for the decline is the industry anticipating a tough year due to worsening trade relations between the US and China and the possible imposition of car import tariffs in the US.

Zenith also anticipated that television, while still being the dominant media for auto ad spend, would see its share drop from 54.9% in 2018 to 53.1% in 2020.

Auto brands have been lagging other categories in shifting to digital. It  accounted for a mere 20.9% of category ad spend in 2018 compared to the global average compared to the global average of 40.6%. Zenith believes the auto industry is likely to increase its spend on digital to 24.4% by 2020.

Zenith estimated total auto ad spend to be $35.5 billion across the 14 key markets it studied including Australia, Brazil, Canada, China, France, Germany, India, Italy, Russia, South Korea, Spain, Switzerland, the UK, and the USA. These countries account for 74% of global car sales by volume and 76% of global ad spend.

Zenith’s head of forecasting and director of global intelligence Jonathan Barnard said: “This new research has revealed how differently auto advertising is behaving to the ad market as a whole, as brands tackle unique challenges to their traditional communication strategies.”

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