Zenith says global ad spending will reach US$640 billion this year, although it has detected signs of a slowdown since its last forecast.
In June, Zenith projected ad spending would rise by 4.6% this year, but has revised that to 4.4% in its most recent report. However the Canadian spending forecast remains essentially unchanged at US$11 billion (or $14.28 billion in Canadian dollars).
The media services firm predicts that North America will trail only fast-tracked Asia in overall growth this year, 5.5% versus 5.6%. The North American market has been boosted by what it describes as a “flood” of small and medium-sized businesses using Facebook and Google to advertise for the first time, complemented by digital-first businesses that are turning to traditional media to boost awareness.
Not surprisingly, the U.S. is setting the pace when it comes to growth. The world’s largest ad market is expected to account for 46% of all additional advertising expenditure (approximately $38.8 billion) between now and 2021.
Internet advertising: Online will account for 35% of all global ad spending this year, and continues to grow rapidly despite its size. Zenith is calling for growth of 11% this year, and an average of 10% growth in both 2020 and 2021, when it will account for 52% of all global ad expenditures.
Internet advertising in Canada: Zenith projects internet ad spending to hit $7.8 billion this year, rising to $8.5 billion by 2021.
Television: Zenith predicts that TV’s share of advertising will decline from 30.8% in 2018 to 26.5% by 2021, driven primarily by growth in display advertising, a category that includes banners, online video and social media.
Television in Canada: Zenith expects TV advertising to reach $3.1 billion this year, dropping slightly to $3 billion by 2021.
The rest of the Canadian picture
Newspapers: The report notes that Canadian newspaper spend is “trending well” this year, with projected revenue of $1.15 billion (up from $1 billion in 2018). The report attributes growth to “still strong demand” from older Canadians and its strength within the financial and automotive categories.
Magazines: Revenues are expected to slip to just $158 million this year. That’s a steep decline from $732 million in 2007, with the report noting that spend is increasingly shifting to digital magazines. Zenith expects magazine spend to drop to $142 million by 2021.
Radio: The recent high water mark for radio came in 2013, when ad revenue peaked at $1.6 billion. This year radio revenue is projected to come in at $1.4 billion, falling slightly to $1.3 billion by 2021.
Out-of-home: Will rise to a high of $707 million this year, largely on the basis of increased digital inventory. The report notes that measurement strategies, targeting and buying capabilities are still in the early stages, but are expected to strengthen with time, allowing for greater efficiencies. OOH is expected to grow to $721 million by 2021.
Zenith also says that Bell Media’s recent acquisition of the resto-bar advertising company Newad will further bolster its already dominant position in Canadian media. Bell, which controls approximately 12% of Canada’s $11 billion ad market, will merge Newad’s 50,000 faces with Astral’s 31,000 faces to create what the company calls a “leading OOH inventory provider” in the country’s major markets.