• by Joe Mandese , December 4, 2009

On the eve of a series of new ad spending forecasts scheduled to be released during UBS' "Media Week" conference in New York next week, WPP's GroupM unit this morning issued an update for one of the world's most developed advertising markets - the United Kingdom - indicating that it may be among the first to pull out of the global economic recession next year. In the new forecast, GroupM Futures Director Adam Smith now expects ad spending in the U.K. to expand 0.1% in 2010, an improvement from his previous forecast of a 3% decline for 2010.

"Both 2009 and 2010 are looking slightly better than we imagined six months ago," states Smith, who oversees GroupM's forecasts. "Confidence seems to be improving, though based on anecdotes rather than substance. This alone may be enough to revive marketing investment, but it cannot make any easier the fiscal and household consolidation which lies ahead in 2010."

Smith also upgraded the outlook for U.K. ad spending in 2009, predicting it now will decline only 12% vs. his previous forecast of a 14% decline for the year.

"We still have most media types negative on revenue in 2010, but media value is about innovation as much as price" he added. "A high and rising proportion of digital marketing is already performance-based, and raising the ROI bar in traditional media."

In his revised outlook, Smith thinks traditional media such as TV (-0.2%), radio (-5.0%), national newspapers (-5.8%), regional newspapers (-4.6%), and magazines (-8.1%), will continue to slide in 2010 U.K. ad spending, but outdoor will actually expand 2.2%, and digital media such as the Internet (+7.3%) and mobile (+50.0%) will grow at relatively high rates.

GroupM said the U.K. turnaround reflects the fact that it was among the first industrial markets to fall into an advertising recession, so it could be among the "first out."

GroupM will release its revised global ad spending outlook on Dec. 8th.