Global advertising spend is forecast to grow 4% in 2017 to $558 billion according to the latest Zenith Media predictions. The forecast is still 0.2 percentage points below one made in June 2017, and whilst Zenith expects growth to continue for now, it is likely to decline over the coming three years.
When it comes to regional growth rates, the report reveals that North America was quick to recover from the effects of the financial crisis. Ad expenditure for the region is predicted to increase 3.6% this year with an average 3.4% growth a year to 2019.
Meanwhile Latin America is set to grow ad spend by 2.5% in 2017 and 2.7% annually until 2019. Western and Central Europe are seeing annual average growth rates of 2.6% whilst the biggest gains are being made in Eastern Europe and Central Asia at an annual growth rate of 9.2% to 9.4% to 2019.
At the same time, fast-track Asia, which Zenith defines as those economies growing rapidly by adopting Western technologies and practices is predicted to grow 7.6% in 2017 and an average 7.3% thereafter.
In terms of advertising medium, Internet ad spend will overtake traditional TV in 2018. It is now on track to become the largest single ad medium accounting for 37.2% of expenditure. However, maturation means slowing growth at some point. Zenith says that Internet expenditure likely grew 18% in 2016 and is set to increase 12% a year between 2016 and 2019 – accounting for 42.2% of global ad spend in 2019.
Display is the fastest growing Internet sub category at 14% annual growth rates to 2019. This includes online video, banners and social media. All of these formats have seen significant gains through programmatic buying. Online video advertising is predicted to increase 21% a year between 2016 to 2019 driven by high quality content and improvements made to mobile viewing experiences.
Indeed, social media has become a regular check point for consumers. As such video ads and social media are not mutually exclusive.
Mobile ad expenditure reached $80 billion in 2016 representing 44.6% of all Internet expenditure and 15.2% of total ad spend. By 2019, the format will have grown to $156 billion ahead of desktop’s $94 billion and account for a whopping 62.5% of Internet expenditure and 26.4% of all ad spend in 2019.
Zenith predicts that mobile will be the core driver of global ad spend growth, contributing an extra $76 billion between 2016 and 2019. The rapid rise in mobile is being balanced by a $6 billion decline in desktop ads.