Significant ad spend growth not expected to return until 2010

LONDON - With the effects of the credit crunch biting hard into media, Zenith­Optimedia has clawed back its forecast for total UK ad spend this year and in 2009, with significant ad spend growth now not expected to return until 2010.

While in June Zenith forecast total UK ad spend would grow by 5.6% in 2009, it now only expects UK ad spend to increase by 1.5% next year.

TV and newspapers are forecast to suffer more than any other media over the next two years. ZenithOptimedia expects TV ad spend to fall 8.3% this year versus 2007 and newspaper ad spend to fall 7.2% this year versus 2007.

Should Zenith's forecasts come to fruition, it would compound what has been, according to Nielsen data, an extremely tough time for media owners with the economic downturn forcing advertisers to rein in ad spend. Analysis of Nielsen ad spend, released exclusively to Media Week, reveals that clients pulled nearly £84m of ad spend year on year during the first seven months of 2008.

Press has borne the brunt of clients' more cautious outlook, with some £67.7m of ad spend being pulled out of the medium year on year - twice the fall of outdoor, the second most-affected medium.

Sly Bailey, Trinity Mirror chief executive, said: "As media businesses, we can't defy the gravity of the ad markets, but we can influence the way we run our businesses so we come out the other side of the downturn stronger and more resilient."

In a rare bright spot for the industry, however, cinema was the only one of the six media assessed to take more ad spend year on year. Gemma Atkinson, sales director, Digital Cinema Media, said: "There has been a huge increase in food advertisers and also travel and transport."

Meanwhile, online ad spend is expected to continue to increase, albeit at rates lower than the boom years of the early part of the decade. Zenith expects year-on-year online growth of 21%, 20.3% and 23.7% over the next three years.

Mark Howe, country director, UK, Google, said growth is "down to the accountability and the opportunities that search is still being appreciated for by marketers".

Zenith expects newspaper ad spend to fall by 4.2% in 2009 versus 2008 and Adrian Jeakings, incoming chief executive of Archant, warned: "It is too early to tell how long the economic downturn will last, but we do not expect things to get any better before the end of 2009."

Zenith's outlook for radio ad spend has significantly darkened. In June, it forecast radio spend would fall 3.5% this year versus last year, but now it is forecasting radio ad spend to fall 6.4% this year.

Stuart Taylor, deputy chief executive of GMG Radio, said: "Obviously the economic downturn has impacted on our revenue, but it has not prompted any drastic rethinks."

According to the Nielsen data, outdoor ad spend fell by £12.6m year on year, but Barry Sayer, chief executive, Clear Channel Outdoor UK & Ireland, said clients will soon return: "Once things have stabilised, people will see they need to spend money on marketing to continue to sell products."

Have your say...

Before commenting please read our rules for commenting on articles.

If you see a comment you find offensive, you can flag it as inappropriate. In the top right-hand corner of an individual comment, you will see 'flag as inappropriate'. Clicking this prompts us to review the comment. For further information see our rules for commenting on articles.

comments powered by Disqus
Media Week Jobs
Search for more media jobs

Latest

Timeline: A look back at April Fool's marketing

Timeline: A look back at April Fool's marketing

It is every pranksters' dream day, but now the annual practical joke occasion is an opportunity for brands to put themselves in the eye of gullible/on the ball consumers via creative pranks. Here, we take a look back at the best hoaxes throughout the last decade.

Share
Brands on Buzzfeed: Just add puppy GIFs

Brands on Buzzfeed: Just add puppy GIFs

We take a look at McVitie's posts on Buzzfeed (a long look, puppies are involved), James Cordon's bod and an even longer look at April Fool's Day pranks over the past decade.

Share
Martin Sorrell: Advocacy is part of advertising

Martin Sorrell: Advocacy is part of advertising

Advocacy is not threatening to usurp advertising because they are both part of the same process, according to WPP's chief executive, Sir Martin Sorrell.

Share

Get news by email