Dentsu Aegis issued a revised and downgraded 2018 ad-spending growth forecast today, predicting growth of 3.6% to $589.5 billion worldwide. In its June 2017 spending report, the firm had forecast 4.3% growth for this year.
The new report also pares back the forecast for U.S. spending growth -- now estimated at 3.2% to $216.9 billion, versus the 4% growth the company predicted in June.
Still, the downgraded figures reflect growth that is expected to be larger than 2017 growth both globally and in the U.S. (3.1% and 2.5% respectively).
At the country level, the picture is mixed, per the latest report. Spending in the U.S., Germany and India will grow faster this year versus last year, while there are signs of a slowdown in the the UK, Russia and China. The firm slashed its growth estimate for the UK to 2.9% from the previously forecast 5.9%. If the 2.9% figure holds, that would be a drop in UK growth versus 2017 (3.2%).
Growth in Russia is now forecast at 10.4% versus 12.9% for last year. The comparable figures for China are 5.4% and 6%, respectively.
This year’s growth will be fueled in part by the Winter Olympics, FIFA World Cup and U.S. midterm elections.
Jerry Buhlmann, CEO Dentsu Aegis Network, stated: “The latest ad spend forecasts show a market in transformation, but not recession. The challenge for brands is to navigate an uneven economic outlook alongside a rapidly evolving tech and innovation landscape. In many markets, disruptive innovation -- from mobile, voice activation and new ad tech players -- is still providing new sources of growth and we forecast this trend will continue into 2018.”
“Succeeding in this environment,” added Buhlmann, “requires global consistency through appropriate platforms and systems, while also the flexibility and agility to work with a wider ecosystem of tech-enabled solutions. It demands a relentless focus on understanding the consumer, using data to reach real people, driving relevance, addressability and business growth.”
The forecast is based on spending data from 59 markets. The full report can be accessed here.