Citing improving corporate profitability and more than $1 billion in incremental ad spending from the so-called quadrennial effect of the U.S. presidential elections and the Olympic Games, Zenith said it now expects U.S. ad spending to grow 5.0 percent in 2004.
Zenith's upward revision follows a similar correction made last week by the equities research team at Merrill Lynch, which now predicts U.S. ad spending will grow 5.8 percent in 2004. Previously the securities firm expected U.S. ad spending to grow only 5.4 percent.
During the UBS Warburg conference this morning, Universal McCann forecaster Bob Coen also will issue his new outlook and he is also expected to boost his expectations.
Meanwhile, Zenith said Europe would continue to lag the U.S. ad recovery with a 2004 ad expansion rate of only 3.7 percent.
"The USA is a mature advertising market, but its economic freedom relative to the sclerotic European Union means it will sustain between 45 percent and 46 percent of global display advertising spend," said the report.