GroupM tips global marketing spend to hit $1 trillion in 2017

Sarah Homewood
By Sarah Homewood | 3 August 2016

Despite revising its initial estimates, WPP's GroupM has predicted that global marketing spend will exceed one trillion US dollars in 2017.

The holding group has tipped that next year ad volume will hit USD$552 billion and when that's combined with other marketing services, this is when the trillion dollar mark is surpassed.

In Australia digital is tipped to keep the top share of media with the channel said to be gaining 49.1% of dollars in 2017. Digital is followed by mainstay TV, with the channel's share sitting at 24.9%. Newspapers comes in third with a 10% share.

Ad volume is up 4.3% year-on-year, however slowing growth in China and Brazil this year drove GroupM to downgrade its 2016 growth estimate to 4% from the 4.5% earlier predicted.

These numbers come from the group's 'This Year, Next Year' report and highlights that in Australia there are a lot of political and economic factors at play, however these aren't expected to have a dramatic impact on spend.

When it comes to the main drivers of spend locally, the reports notes that ratings and profitability of the major networks remains an issue as behaviour shifts to video and catch-up viewing. The strongest growth in digital is predicted to come from video over the next five years and spend on mobile search and display is also expected to double in the next couple of years.

Dominic Proctor, president of GroupM, global says the group is increasingly focusing on performance versus the commodity pricing of media, due to the continued fragmentation of the landscape.

“The impact of media consumption migrating to digital platforms, and the flow of advertising investment with it, must not be underestimated by advertising clients.

“This fragmentation of billions of consumer impressions across thousands of platforms demands the use of data and technology to create bespoke and meaningful targeted audiences for brands. This is the transition from media planning to audience planning and the reason why GroupM continues to focus investment in talent and technology around data and analytics,” he added.

Globally digital advertising investment accounts for 99% of net 2016 growth versus traditional media, and it's a similar story in Australia with traditional channels such as TV, newspapers and magazines are all expected to see drops in spend in 2017.

It's a different story for radio and digital however, with radio predicted to see a 3.2% yoy rise in 2017 and digital is primed to grow by 11.2% in the next 12 months.

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