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Carat revises downwards ad spend growth to 5% in 2012

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MUMBAI: Media Communications specialist Carat, part of Aegis Media, has revised downwards the global ad spend due to economic stresses in Europe and the US.

In its new forecast, Carat has predicted global advertising expenditure to grow at five per cent in 2012, down from its earlier forecast of six per cent.

For 2013, Carat has downgraded the global ad growth to 5.3 per cent from 5.8 per cent. The company had made its previous forecast in March 2012.

These latest forecasts are consistent with the view of the two-speed world whereby we continue to see significant growth from the faster-growing regions of the world versus the lower levels of growth in the developed economies of the US and Western Europe, with Western Europe being impacted by low or negative growth, particularly in Southern Europe.

The data also shows that global investment in Digital Advertising will overtake investment in Newspapers sooner than expected, in 2012 rather than 2013, as audiences continue to move online.

By media, digital remains the driving force in the market in terms of growth, continuing to outstrip growth in other verticals, followed by Out-of-Home (OOH) and television.

Year on year percentage growth at current prices

(Figures in brackets show the previous forecasts from March 2012)

2012
2013
Global
5.0 (6.0)
5.3 (5.8)
North America
4.9 (5.0)
5.3 (4.3)
USA
4.9 (4.9)
5.3 (4.2)
Canada
3.3 (5.4)
4.3 (6.1)
Western Europe
0.2 (1.5)
1.1 (2.2)
UK
2.8 (4.0)
2.8 (3.4)
Germany
1.1 (1.2)
1.5 (2.0)
France
0.5 (1.5)
1.9 (1.9)
Italy
-5.0 (1.2)
-0.4 (1.0)
Spain
-8.0 (-4.7)
-5.4 (1.6)
C&EE
7.9 (9.5)
8.8 (9.0)
Russia
14.1 (15.2)
13.1 (12.8)
Asia Pacific
6.8 (8.7)
6.5 (8.6)
Australia
1.0 (2.9)
2.0 (2.7)
China
11.0 (14.7)
9.8 (14.6)
Japan
2.9 (3.0)
2.8 (0.7)
Latin America
12.0 (10.7)
9.0 (8.2)
Brazil
12.8 (10.5)
9.4 (8.0)

Commenting on the Carat forecasts Aegis Group CEO Jerry Buhlmann said, "Carat‘s latest ad spend forecasts show the continuation of two fundamental trends which have changed the advertising industry. Firstly, Digital Media continues to grow materially ahead of all the other media and has overtaken newspapers - a year earlier than expected - to become the second largest medium in terms of advertising spend, behind TV. The trend of audiences moving online shows no sign of slowing down, as demand for online content and the proliferation of internet and mobile access increases. In parallel to this, the trend of the two-speed world continues, with the rates of growth in the emerging economies remaining well ahead of the US and Western Europe.

"With these two themes - globalisation and convergence - the media landscape is becoming increasingly complex. In addition, it is creating exciting new growth opportunities for the global advertisers and changing the demands they place on the advertising groups. In these changing times, for those that have the most focused and specialist offerings, along with the global reach and scale to provide innovative integrated solutions that deliver real results, there are exciting times ahead."

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