Magna Global Forecast: Trad TV, Digital Reign
Magna Global predicts the U.S. ad economy will grow at a 3.1% rate this year, about on par with 2010. The estimate labors to use an apples-to-apples comparison by excluding the impact of political and Olympic revenues last year.
The revenue forecast predicts that traditional TV and older forms of digital media will continue to soar. "We expect TV advertising to rise by 6.3% on a normalized basis during 2011 and digital display to grow by 11.6%," Magna noted.
As Magna offered its 2011 estimates, the firm said that growth remains hampered by "continuing weakness in unemployment ... the absence of a meaningful pick-up in the overall economy and constrained deployments of capital among businesses of all kinds."
Total ad expenditures in 2011 are estimated to come in at $173 billion. That's below 2003 -- which pre-dates the mid-2000s boom. One reason could be that auto spending may have been much higher back in 2003, even though the category is experiencing a recovery now.
Magna's 2011 forecast includes the continuing dynamic of a suffering print industry versus a thriving online and digital segment. The two tend to have offsetting effects on each other during overall ad revenue projections.
Also, Magna projects that the broad print segment with newspapers, magazines and direct mail will decline by 2.9% in 2011. But, for example, out-of-home is booming: Digital display advertising will grow by 11.6%, while online video will rocket 26.8%.
Mobile advertising should soar by 60.1%. Paid search is estimated to be up 11.1%.