Global advertising expenditure will continue to grow at a faster
rate than the world economy in the next three years, according to
research published this week.
Figures published by Zenith Media anticipate that global adspend will
have risen by 4.6 per cent in real terms by the end of 1999 to dollars
299.7 billion. This is greater than predicted mid-way through the year
and has been boosted by the injection of spending from e-commerce
companies racing to establish brands in the US and Europe.
In 2000, Zenith predicts that world adspend will continue to grow - to
dollars 319 billion, reaching dollars 338.8 billion in 2001. This growth
will be principally driven by the consumer boom in the US - by 2002 the
US will account for 44 per cent of worldwide advertising expenditure -
aided by a recovery in the Asia-Pacific economies, excluding Japan.
Other contributory factors include a projected trebling of spend from
new-media companies, and the 2000 ’quadrennial’ - the presidential and
congressional elections and the 2000 Olympics -which will also boost the
industry.
’Economic conditions in the West are ideal for advertising growth and
the East is out of recession and recovering well,’ John Perriss, the
chairman of Zenith Media Worldwide, said. ’The need to advertise has
never been greater. E-commerce is the classic example of the imperative
to educate, persuade and differentiate. We know every boom must end, but
the outlook is still good.’
The only blot on the horizon is the threat of consumer price inflation,
which is forecast to start rising next year.
This leads Zenith Media to predict that 1999 may turn out to be the year
of fast growth in the present economic cycle. In 2000 underlying
constant price growth rates will be checked by rising inflation.
