Australia sits among 10 countries which will experience some ad spend growth by the end of 2015 and has escaped a half-year downgrade revision suffered by six other countries.
According to the Warc International Forecast, on a local currency, year-on-year basis, Australia ad spend is expected to grow by 2.6%. However, when calculated on constant price basis, the Australian figure reduces to 0.7%.
India (16.1%), China (9.0%), UK (6.6%) and Brazil (4.8%) are the only other countries sitting ahead of the local market, it said.
However, senior figures in adland have disputed the 0.7% figure, saying that even on a constant currency basis, the market could be heading for at least 2% growth by the end of the year.
Carat CEO Simon Ryan told AdNews, “It’s great to see this predicted growth in ad spend in Australia, but from my point of view I would expect that the proliferation of media means that there is certainly more growth than this number suggests.”
Optimistically, Ryan expects that the figure will undoubtedly be higher by the end of the year: “If we compare year-on-year to-date when looking at our clients, we can already see that there is an increase in spend. I doubt very much that the figure will be as low as Warc says. I would expect that figure to come in at 2%.”
Maxus national trading director Nathan Cook says that the latest forecast is unexpected, but also points to the 2% figure highlighted by Ryan.
“If you look at the Australian ad market (through SMI) over the medium term (say the past 7 years) on average we have grown at just under 2%, this has a close correlation to the CPI,” he said.
Cook adds, “Even if the shape changes, and by media type we see some fluctuations, the broader picture would indicate the modest and sustainable growth we have come to expect from the market over the medium term.”
Australia has escaped a Warc downgrade from last December, unlike half of the territories monitored by Warc for this report. They include the US, China, India, Russia, UK and France.
The two largest downgrades are in the US (-3.0%) and China (-1.5%). However, the biggest single cut was for Russia (-15.1%), which is suffering from low oil prices and decreasing consumer spend.
Global advertising spend rose 5.1% at current prices in 2014, the strongest rate since 2011.
The expected dip in growth rate in 2015 compared with 2014 stems partly from the absence of notable events such as the FIFA World Cup and the Winter Olympics, slowing growth in parts of Asia and a weaker US TV market.
Global ad spend on digital is expected to rise 16.1%, cinema by 3.2% and outdoor by 0.3%. The following media is expected to decline: radio (-1.2%), TV (-1.9%), newspapers (-9.2%) and magazines (-10.4%).
Email Nicola at nicolariches@yaffa.com.au.