Zenith, McCann expect growth in ad spend next year

MUMBAI: Two ad agencies have predicted better tidings for global advertising next year. The growth in adspend will be fuelled by the August Olympic Games in Athens and by the US presidential elections. However the scene for Europe is not too rosy, say both Zenith and McCann.

Publicis' Zenith Optimedia says 2004 global ad spending on major media would grow 4.7 per cent. Meanwhile, Universal McCann which is a part of New York-based Interpublic, expects growth in the region of 5.8 per cent.

The two above mentioned events are expected to result in some $ one billion in extra advertising, most of which will be translated onto television. Zenith said US ad spending would increase five per cent and spending in Asia would rise 5.1 per cent. European ad spend however, would recover more slowly, with a projected 3.7 per cent increase.

Meanwhile a report in USA Today said that barring a major terrorist attack a la 9/11, Madison Avenue should post its best performance since its record growth year of 2000. This is because of the growth in Internet advertising which is progressing at a rapid clip.

Universal McCann's Robert Coen has predicted that US media spending will grow 6.9 per cent to more than $266 billion in 2004. The global media economy will grow 5.8 per cent to more than $498 billion. However, the media recovery will be uneven. While the broadcast network, Internet and newspaper sectors will grow 12, 10 and 7.5 per cent respectively, magazines and Yellow Pages will increase only five per cent and 3.5 per cent.

Zenith Optimedia CEO John Perries added that advertisers are loosening the purse strings after focusing on cost control over the past few years, Another report in the MediaGuardian stated that in the UK the boost given by the World Cup to television advertising has given the best indication of recovery so far.

While ad spend in the UK is expected to fall by 1.2 per cent over the year, demand for UK television advertising in the second quarter turned rose by five per cent following an 11 per cent decline a couple of years ago. Coming to this year, the ad spend is expected to fall by 1.4 per cent in the US, UK, France, Germany, Italy, Spain and Japan. Germany is the worst hit with spending forecast expected to decline by 5.3 per cent this year.

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