Starcom has become the latest media agency to downgrade its growth predictions for 2012, revising its ad spend forecast down from 3.8% to 1.3%.
The downgrade comes only days after Aegis-owned agency Carat downgraded its forecast for 2012 from 2.9% to 1%.
According to the Starcom Media Futures Mid-Year Update, which is based on interviews with national advertisers and media executives, the outlook for the local market is decidedly less rosy than previously predicted.
Those interviewed for the paper reported that growth in the first half of the year was 1.8%, down from a predicted increase of 3.8%. The second half of the year is expected to be tighter still.
This marks the second year advertisers have overestimated their budget growth rate.
This report also marks the lowest proportion of increased ad spend in the three years since the report was launched, with only 38% of budgets increasing in the first six months of the year compared to 44% last year.
Starcom MediaVest chief John Sintras said: “These figures reflect a trend we have observed over the past few years, with advertisers exercising a cautious approach to spending in a climate where there is still uncertainty over the global economic conditions.”
In the second half of 2012, only 33% of advertisers have predicted an increase in their advertising budgets.
“The past two years of the survey have shown the mid-year update is a much closer forecast to actual spend, so it’s likely to be a very tight end to 2012,” Sintras said.
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