Global ad spend is forecast to grow 4.7% to US$572bn in 2018, boosted by major sporting events and politics, reports international marketing intelligence service WARC.
The growth is being driven by the PyeongChang Winter Olympics, the FIFA World Cup in Russia and US mid-term elections, as well as reduced dollar volatility in emerging markets.
Warc’s monthly Global Ad Trends report focuses on ad expenditure in 96 markets and tracks key trends in spending patterns by media and geography since 2009.
Global advertising spend rose 3.0% to US$546bn in 2017. The growth rate in 2017 represents a slowdown from the 3.8% rise recorded in 2016, partially owing to weaker growth in the US, which accounts for 34% of advertising spend worldwide.
The Asia-Pacific region, the second largest ad region following North America, is expected to grow 6% this year.
In 2017, it was uncharacteristically low at only 4.3% growth (US$162.8bn) compared to 5.3% in 2016.
This year should be a "stellar year" for global advertising, Warc data editor James McDonald said.
"Ad investment set to grow at its strongest rate since the post recovery years of 2010 and 2011. All global regions, with the exception of the Middle East, are expected to register growth, supported by key quadrennial events."
North America (5%), Western Europe (2.6%), Central and Eastern Europe (8.4%) and Latin America (7%) will continue to expand at a strong rate, while the Middle East and Africa is expected to drop once more (-4.1%).
Mobile reigns supreme as global ad spend grows
Mobile was the only medium to gain share of global expenditure in 2017, up 5.9 percentage points. Mobile ad spend grew 45% and now has 20.6% share of global ad spend, about US$112bn.
Nealry half (45%) of mobile advertising spend is in the US, where US$156 per capita is spent on mobile ads.
The largest media channel, TV, is estimated to have registered a 1.4 percentage point dip in 2017, taking a share of 36.5% of the global ad spend total (US$199.5bn).
Mobile's rise has contributed to a decline in online display ad spend for desktop, which shed 1.9 points to a share of 18.3% in 2017. Search is the fourth largest channel with an 18% share.
Print continues to lose share, the channel was down an estimated 2.2 points in 2017 to 12.5%. Since 2009, print has recorded a massive 21.5 point decrease in its share of global ad spend, and has lost an average US$11.5bn each year since 2012.
Out of home's share dipped by 0.1pp to 5.7% in 2017, while cinema's share held at 0.7% and radio was down by an estimated 0.2pp to 5.7%.
More ad dollars go to TV networks (US$199.5bn) than the Facebook/Google duopoly (US$133.2bn) and TV ad spend outweighs online video by a ratio of 6:1.
"Mobile is now a key driver of global growth, and was the only channel to gain share of spend in 2017 – it now accounts for one in five ad dollars worldwide," McDonald noted.
"Nevertheless, traditional media still attracts 61% of global ad investment, and TV and out-of-home will be among the main benefactors of increased brand and political campaign spending this year."
Other key findings:
- 3.0% rise in global ad spend last year, to a total of US$546bn
- 4.7% growth forecast for global ad spend this year, reaching US$572bn
- 40% average growth rate in online video spend since 2013
- 45% of global mobile ad spend in 2017 was based in the US
- 61% of global ad spend in 2017 (US$334.1bn) invested in traditional media
- At US$65.8bn, sponsorship will overtake print to become the fourth-largest ad medium in 2018
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