Carat slashes forecast for US ad spend growth in 2005

MUMBAI: With rising oil prices, the dollar downslide and the US current account deficit being potential causes for concern in 2005, media buyer Carat, a unit of UK-based Aegis has sliced its 2005 global advertising spend forecast.

The growth predictions cited for 2005 by Carat has dipped from 4.8 per cent in September to 4.5 per cent in 2005 and the global ad spending to increase by 4.9 percent, compared with the five per cent increase its forecast stated in September.



The agency has said that despite the fact that the world was experiencing a significant recovery in advertising spending and a continued belief of advertising budgets being on the rise in the US, this action was necessary. This move has simply reiterated the concern marketing executives bear today with the recent economic health of the US.


Interestingly, Carat cut its US ad spends forecast to 4.5 from 4.8 per cent although it has increased UK's projected growth to 4.6 per cent from 4.3 per cent due to increased British marketing budgets.

According to agency reports, UK marketing budgets have been revised in the third quarter for the fourth consecutive quarter and this has led Aegis to forecast growth of 6.4 per cent in 2004, compared with previous expectations of 4.6 per cent.

The US advertising sector space although has witnessed the economic scenario heading towards the slowing of growth and fewer job gains. Also, US corporate profits have seen a slight slump in the third quarter which has led to the decline in consumer confidence in the last quarter of 2004.

Another factor in consideration are quadrennial events like the Olympics and the US elections which surged spending by about 6 per cent. 2005 is expected to record a drop in spends across most markets.

ZenithOptimedia and Universal McCann as recently as last month have on the other hand raised their figures of ad spends forecasts this year.



2004 saw Carat in Europe exceed the expected growth levels from 4.4 per cent to 4.8 per cent. It put growth in the UK at 6.4 per cent, up from 4.6 per cent.

Carat has although maintained its 2005 forecast for Europe at 4.4 per cent. But raised its forecasts for Spain from 4.2 per cent to 4.5 per cent and for France from 1.9 per cent to 2.2 per cent.

Coming to the Asia-Pacific region, advertising spends here are expected to grow by 5.8 per cent compared with 6.2 per cent in 2004. Another pint in note being that advertisers are beginning to respond to the fragmentation of television audiences by allocating more funds to the Internet and in non-traditional media.



Carat forecast Internet advertising spend to go up by 20 per cent in 2005 which currently stands at three per cent. The outdoor market was another area pointed out by the agency that would be a strong medium in the years to come which will then evolve to the growth of in-store digital delivery.

Latest Reads
Havas appoints Mediacom's Karl Wu as Greater China CEO

Havas Media Group has appointed media and marketing specialist, Karl Wu, as the CEO for Greater China. Based in Beijing, Wu will be responsible for Havas's brands -- Havas Media and Arena Media, as well as Havas Group pure player agencies Socialyse, Affiperf, Ecselis and Mobext. The media group...

MAM Media and Advertising People
Gulzar lightens up Luminous's Diwali

MUMBAI: Luminous has launched a unique social campaign that celebrates a part of Diwali that we often forget to talk about. While most Diwali campaigns talk about spending and splurging, others talk about the display of lights and fireworks across the country. This campaign, however, goes away from...

MAM Marketing MAM
Multi-media ad campaign to popularise gold coin

A year after it was first launched, a multimedia advertising campaign is being launched to drive awareness around Diwali on the availability of the Indian gold coin by the Mines and Minerals Trading Corporation along with World Gold Council. Being launched this week, the campaign will cover...

MAM Media and Advertising Ad Campaigns
Vizeum launches Binary, special advisory unit for media clients

“Media business is, in the short term, headed for a tipping point, driven by the changing consumer-media interface,” emphasises Vizeum India MD Shripad Kulkarni, who strongly believes that media companies need a definitive transformation strategy in place now.

MAM Media and Advertising Media Agencies
Havas Media bags Rs 15-cr Sujata account

MUMBAI: Havas Media Group India has bagged the integrated media duties of Sujata, an Indian Consumer Electronics & Home Appliances brand for Juicer Mixer Grinders. The incumbent on the business was Exposure Media. The account will be handled out of Gurgaon office led by Uday Mohan. The...

MAM Media and Advertising Account
TV festive ad spend to reach Rs 8000 cr; experts divided

MUMBAI: The festive months of October and November are welcome months not just for you and your family, but for most Indian brands as well. After all, they eagerly wait for this early window when consumers loosen up their purse strings and put their Diwali bonuses to good use, aka, shopping.

MAM Marketing MAM
Amagi partners with BARC India to offer monitoring of geo-targeted TV ad-campaigns

Amagi Media Labs has entered into a partnership agreement with India’s apex television viewership monitoring body BARC India to help advertisers monitor geo-targeted ad-campaigns of brands across TV channels.

MAM Media and Advertising AD Agencies
iProspect conceptualises unique digital video for ICICI two-wheeler insurance

iProspect India has conceptualized and executed a unique digital video for ICICI Lombard General Insurance in their latest campaign on two-wheeler insurance.

MAM Media and Advertising AD Agencies
eBay engages consumer with live game on FB

MUMBAI: Festive season is a busy time for Indian brands, especially the e-commerce players given the shopping spree the nation witnessed around the time. Thus it becomes important to brainstorm on new and unique ways to get the consumer’s attention; something different from the unbelievable...

MAM Media and Advertising Ad Campaigns

Latest News

Load More

Sign up for our Newsletter

subscribe for latest stories