• by Larissa Faw , March 20, 2016

ZenithOptimedia has slightly downgraded its forecast for global ad spending growth in 2016. The Publicis Groupe-owned agency now predicts this year’s growth will reach 4.6% to $579 billion, down a tick from the 4.7% it predicted in December.  

The agency also said it expects global spending to cross the $600 billion mark by the end of 2017. The agency’s forecast for U.S. expenditure growth this year remains 3.8% to about $190 million. 

The shop said there are three main reasons why it is optimistic about the prospects for global ad-spend growth in the near term: special 2016 “special events,” (including the Olympics and political spending), rapid recovery from the markets most affected by the Eurozone crisis, and the emergence of rapidly growing markets that are now opening up to international advertising.

Despite some concerns about its economy, China ad expenditures will continue to rise sharply. “We expect Chinese ad spend to increase by $18.3 billion between 2015 and 2018, while US ad spend increases by $18 billion. This is the first time this has ever happened.

To put this in context, in 2015 China’s ad market was only 41% the size of the US’s ad market, but grew 2.4 times faster. Over the next three years China will maintain this growth disparity, and rise to 46% of the size of the US.”

Robust Internet spending will continue, per the report.

“We expect internet advertising as a whole to grow at more than three times the global average rate this year -- by 15.7%, driven by social media (31.9%), online video (22.4%) and paid search (15.7%). Internet advertising’s growth rate is slowing as it matures (it was 21.1% in 2014), but we expect it to remain in double digits for the rest of our forecast period [through 2018].

This sustained growth, combined with downgrades to television in Brazil in China, has led us to forecast internet advertising to overtake television advertising globally in 2017, a year earlier than we forecast back in December.”

Meanwhile, smaller markets are also boosting growth.  

"We forecast advertising expenditure in [30 up-and-coming] markets to grow at an average rate of 15% a year between 2015 and 2018 -- more than three times faster than global average -- and to increase by $3.9 billion -- a sum equal to the current size of Sweden’s ad market -- to $11.6 billion,"  per the report. 

Sixteen of those markets are in Africa, seven in Asia, six in Latin America and one in the Middle East.