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Monday, 18 August 2014

Global adspend growth rate doubles

Warc, 10 July 2014
NEW YORK: Global advertising expenditure is forecast to grow at 5.7% in 2014, more than twice the rate of the previous year according to new figures from eMarketer.

The insights provider predicted a total of $545.4bn would be spent this year, up from $526.2bn in 2013, helped by specific events such as the FIFA World Cup in Brazil as well as the general trend for digital adspend to increase as people worldwide spend more time on digital devices, particularly mobile.

Digital ad spending was projected to rise 16.7% in 2014 to reach $140.1bn, pushing its share of total media ad spending above 25% for the first time. While growth will decline into single figures in subsequent years eMarketer expected its share of all spending to be very nearly one third by 2018.

Tablets and smartphones are key to this growth and eMarketer estimated that mobile ad spending would leap 84.7% this year to $32.7bn, or almost one quarter of the digital total. That proportion was likely to be significantly higher in more mature markets – 70.4% in the UK by 2018 and 67.8% in the US.

In many developing markets TV was likely to remain the leading channel for some time, according to eMarketer. It noted a lag in mobile ad spending as many consumers continued to use feature phones and argued that low per capita income meant that in any case there was not so much to market to them. Thus, even in major markets like China and India, mobile ad spending would only be 29.3% and 15.8% respectively of all spending by 2018.

Further, "a smartphone infrastructure for consumers doesn't immediately translate to a functional advertising infrastructure", it added.

In terms of per capita spending, the US led the way with an average $565 being spent in 2014, compared to $37 in China and $5 in India.

Warc's June International Ad Forecast expects adspend in its twelve key markets to rise 5.6% this year in PPP terms, and a further 5.3% in 2015.



Data sourced from eMarketer; additional content by Warc staff

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