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Zenith Media bullish on ad spend in India next fiscal

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There‘s good news round the corner for the Indian ad industry.

The annual forecast of global advertising expenditure till 2004 released by Zenith Optimedia Group this week, paints a relatively rosy picture for the country and neighbouring China even as it predicts a faintly dismal scenario for the rest of the world.

2001, the forecast reads, is heading for minus six per cent in real term growth, while 2002 will see a minus one per cent growth. 23 ad markets will contract in 2001 as the global economy shrinks much more in 2001/2002 than in it did in the global recession of 1991.While the report hopes consumer confidence will pull the sluggish ad industry out of the troughs, India and China are the only growth markets highlighted for ad spends in Asia/Pacific in 2002. Zenith Optimedia Asia CEO Antony Young says while the events of 11 September did indicate negative sentiments, India is likely to show marginal growth in the coming year.

The present survey, the first to be released after 11/9, reveals that while travel advertising was obviously hit hard, the industry is posed for a quick recovery. The shock of 11 September galvanised business into addressing its pre-existing problems quickly, it says. The first to recover from the downturn and raise their ad investment, notes the report, will get the best media bargains: ad space will be available at 1990s prices. While corporate earnings may disappoint stock investors in 2002, even modest improvement will show up in advertising, predicts Zenith.

For India, the picture is even brighter. While the second and third quarters of the year have shown dips in ad spend growth, signs of plateauing will be seen in the second quarter and recovery expected from the third quarter 2002.

Overall, single digit positive growth is expected the next fiscal.

India Advertising Expenditure Summary

Major media (TV, print, radio, cinema, outdoor)

The global scenario is not as cheerful though. 2002 is expected to be slightly negative in North America, according to the report. The slightly optimistic note is that ingredients for advertising recovery become visible during the next fiscal.

World Advertising Expenditure Summary

Major media (TV, print, radio, cinema, outdoor)

Ten years ago, we endured two years of worldwide major-media contraction: 3% (in real terms) in 1991 and just under zero in 1992. Advertising expenditure went negative in nine countries in 1990 and a further 10 in 1991.

Compound average annual growth in worldwide advertising spend 1990-1999 was 2.4% in constant prices terms. On our present numbers, the 1999-2004 rate is 1.0%.

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