Revised forecast says ad spend is set to have dropped in 2008

The Publicis Groupe agency has dramatically revised its outlook for UK ad spend downward since publishing its half-yearly forecast figures in June - replacing 4.9% growth with an expected 0.8% drop over 2008.

This is expected to rise slightly to 1.5% in 2009 after another bumper 16.8% year-on-year hike from the internet. Once online is removed from the equation, UK ad spend will fall by 3.1% in 2009.

Jonathan Barnard, head of publications at ZenithOptimedia, admitted "it is now clear the ad market is in the middle of a sharp downturn that began in Q3 2008 and accelerated in Q4 2008".

However, there were some reasons for optimism. Cinema is expected to expand 3.4% this year and remain stable in 2009. Television is also set to perform relatively well in the downturn, falling by just 3% next year.

According to Barnard, this resilience follows trends of the previous two downturns in 1991 and 2001, with advertisers shifting expenditure from secondary media to the perceived safety of TV and its proven history of being able to build brands.

Retail and FMCG advertisers are expected to continue to outperform the market, while finance, telecoms and motors fall behind. From an audience perspective, all adult viewing is up 3.5% in 2008, which Barnard believes will continue into 2009.

Elsewhere, there are a series of revenue drops forecast across the media for 2008 and 2009 respectively - national newspapers down 7.2% and 3.6%; radio down 6% and 3%; magazines down 5.9% and 2.8%, and outdoor down 7.6% and 2%.

These trends are in line with those forecast last week by WPP's GroupM, despite it revising its own growth forecasts for internet ad spend in 2009, down from 20% to just 3.7%.

Adam Smith, futures director at GroupM, warned: "Past recessions have lasted one or two years. This one feels like a two and we are evidently some way from the bottom. "Any sign of recovery in 2009 would be a nice surprise."

According to GroupM, among the larger countries also shrinking in 2008,?media spend in Japan is forecast to drop?6%, Spain 14%, and Germany and Italy both 1%.