WPP’s GroupM, a leading global media investment group, has released its 2016 global ad expenditure forecast and shared its revised outlook for 2017.
The main news? Advertisers will try to do more with less, as numerous economic factors across the globe presage yet another year of modest growth in advertising.
“Brands continue to be pressured for performance in low-growth environments,” notes GroupM. “Despite the overhang of uncertainty tied to outcomes of the U.S. Presidential election and the U.K. referendum on departing the European Union, advertising budgets have not yet been impacted. China and other “new world” countries continue to over-contribute to global growth, but a new normal more modest level of growth has settled in.”
The main beneficiary of any growth? No surprise here: it’s digital advertising.
“In 2017, advertising is predicted at $547 billion (+ 4.4 percent), with digital’s share to reach 33 percent,” reports GroupM. “In 2016, digital captured 72 cents of every new ad dollar (USD), and TV 21 cents. In 2017, digital will capture 77 cents per new dollar, TV will get 17 cents. The U.S. and China account for half of all net growth in the 2016 and 2017, with China taking back a narrow lead over the U.S.”
Prediction intelligence is drawn from WPP’s worldwide resources in advertising, public relations, market research, and specialist communications.
The report is from “This Year, Next Year” by GroupM’s Futures Director, Adam Smith.
“Ad growth has shadowed the global economy’s long, low and level recovery cycle since 2010,” said Smith. “These new forecasts emphasize the ad story of our times is however structural, not cyclical. Twenty years on from the internet becoming a measured ad medium, digital remains the engine of advertising growth and disruptor-in-chief of the entire marketing economy.”
“This multiplies options, opportunities, and risk,” noted Smith. “The importance to advertisers of autonomy and diligence has never been higher.”