New research shows that big brand budgets and quadrennial events such as the Olympics, European Football Championships, and the U.S. Presidential Election will be shown to have driven 2016’s global advertising revenue growth to $532 billion.
The data comes from IHS Markit, a world leader in critical information, analytics, and solutions, in its annual “Global Advertising Trends.”
“The advertising industry is about to turn the corner thanks to the global economy getting back on track,” said Eleni Marouli, a principal analyst with IHS Technology, and the author of the report.
“Advertising revenue will grow 7.1 percent in 2016 to $532 billion,” noted IHS Markit. “Strong growth in global real private consumption also buoyed advertising revenue as brands tried to take advantage of heightened consumer spending. Advertising revenue accounted for 0.69 percent of global GDP in 2016, up from 0.66 percent in 2015.”
Interestingly, the top 10 markets make up 75 percent of the global revenue figure.
“The top 10 markets still account for the lion’s share of global advertising revenue,” Marouli said. “However, their collective power has dropped due slowdowns in the Chinese and Brazilian economies, which were the rising stars in the top 10 in 2015.”
What are the fastest growing regions for advertising in 2016? Four out of five are actually in Africa.
“Ghana and Kenya have been high on the list of many media companies’ expansion plans, and we are seeing growth above 20 percent,” Marouli said. “These markets are still growing from a low base, but the sheer size of their populations means they are becoming interesting targets for big brands.”
And though TV was the number one advertising medium, all signs point to it being overtaken by online advertising by 2020 — just five years from now.
“In some countries such as the UK, online already accounts for almost 50 percent of total advertising revenue and will only keep getting stronger,” Marouli said.
In other report news, it was revealed that Israel, Switzerland, and the U.S. top the ad spend per person chart.
“The most mature markets are mostly high GDP per capita markets, according to the IHS Technology report,” notes the report. “Israel topped the list at $719, followed by Switzerland and the U.S. China generated only $65 per person in advertising, despite being the second largest advertising market. Zimbabwe was the last on the list with $0.002 ad revenue per person per year.”