Carat, the world’s largest independent media agency network, has said that ‘solid recovery’ in Europe and the US has led to an increase in its advertising spend forecasts for 2004 and 2005, despite the Olympic Games failing to provide the significant uplift expected.
According to the new report, global spending on advertising in 2004 is now expected to reach 5.7%, up from March’s forecast of 5.3%. While, 2005 is predicted to increase from a 4.4% growth to 5.0%.
Carat said, spending on the Olympic Games is not expected to have the impact once predicted, as many clients admitted that their budget for the year will remain steady, although a few had re-allocated budgets around the time of the major sporting event.
The new survey revealed that, out of 46 countries, only nine reported an increase in advertising expenditure around the time of the Olympic Games; Australia, Austria, Germany, Greece, Hong Kong, Israel, Japan, Malaysia and Taiwan.
In Europe, advertising expenditure is now showing solid recovery, said Carat, led by good growth in the UK, Italy and Spain, as well as an upturn in France’s advertising spend.
Advertising spend in the UK is expected to reach 4.6% this year, spurred by online advertising which is continuing to outstrip all other media, with a 17% rise expected. Outdoor is also predicted to perform well, growing to 9.1%, with television up 3% from January to May.
In the US, all media enjoyed a strong spend in advertising expenditure in the first quarter, said Carat, which is expected to be repeated in the third quarter of this year. However, during the second quarter, spending was ‘softer with concern over increasing oil prices and rising interest rates’ and this pattern is expected to repeated in the fourth quarter of 2004.
| September 2004 Forecast – Year On Year % Growth At Current Prices |
| |
|
|
| |
2004 |
2005 |
| Global |
5.7% |
5.0% |
| USA |
5.8% |
4.8% |
| Asia Pacific |
6.2% |
5.8% |
| Europe |
4.4% |
4.4% |
| |
|
|
| Source: Carat, September 2004 |
Carat said: “There is no doubt that the presidential election has boosted advertising expenditure so far. The two main drivers of growth in the first half of the year were paid political messages and an increase spend by traditional advertisers.”
