Olympics, Online Video and Local Search To Drive Global Ad Spending

According to a study recently released by ZenithOptimemedia, the Olympic Games will help lift television's share of the global ad market to a record 38.2% in 2008. The study predicts that Online video and local search will drive 30% growth in internet ad expenditure this year, nine times faster than the rest of the ad market, and after credit squeeze and continued slump in the US housing market, the US is expected to increase only 2.5% in global ad spending, down from 3.3%

*Note: The totals shown are lower here than the totals in the ‘Advertising expenditure by region' table below, since that table includes total adspend figures for a few countries for which spend is not itemized by medium. This table also excludes some advertising that does not fit into the above media categories.

Television faces many challenges, says the report: - the spread of DVRs; migration of viewers from premium mass-audience channels to cheaper specialist channels; and competition from the internet, to name three of the biggest. Despite all these, television will increase its share of global ad expenditure from 37.9% in 2007 to 38.2% in 2008, an all-time record.

Television is losing market share in in North America and Western Europe. However, the faster growth of ad markets in the rest of the world is counteracting this trend, as television tends to attract a much higher share of ad expenditure, because they are more dependent on FMCG advertisers, and their inhabitants have less media choice. The study expects the coverage of the Olympics in Beijing to give an extra boost to television in 2008, particularly in China and its neighbors.

The report now forecasts Internet advertising to grow 29.9%% this year (up from 28.6% three months ago). Online video and local search are the new, fast-growing segments.

Newspapers, says the report, are suffering the most from the depredations of the internet, which is better at delivering timely news and is an efficient substitute for newspaper classifieds.

Newspapers' share of world ad expenditure is expected to fall from 29.0% in 2006 to 26.2% in 2009, while outdoor is forecast to increase its market share over the same period, with new digital displays that make it easy for advertisers to book and distribute eye-catching ads at short notice.

The continued slump in the US housing market has led to a sharp drop in property and construction advertising, particularly property classifieds in newspapers. This, and the recent credit squeeze, finds the study downgrading the forecast for growth in the US this year from 3.3% to 2.5%.

The report shows Western Europe, Asia Pacific and Latin America this year as largely unchanged, though the study forecasts Central & Eastern Europe to grow 18.3% this year (up from 16.9% three months ago) and Africa/Middle East/Rest of World to grow 17.2% (up from 15.6%).

For more information from ZeinithOptimedia, please visit here.