ZenithOptimedia: Global Ad Spend to Grow by 5%-6% in the Next Two Years

In a press release published by ZenithOptimedia on December 8, 2014, the London-based media agency forecasts that global ad expenditure will rise by 4.9% to $545 billion in 2015.

The growth is reported to be largely due to the continuous improvement of the world’s economy, as well as the increasing revenue generated by social media, mobile advertising, and programmatic buying. Although growth is remarkable, this is slightly lower than 2014’s 5.1% brought about by tough year-on-year comparisons from the Winter Olympics, World Cup, and U.S. mid-term elections.

ZenithOptimedia predicts that 2016 will see a boost in the total global ad spend, prompted by the Summer Olympics, U.S. Presidential elections, and the UEFA European Football Championship. Global ad expenditure is expected to rise to as much as 5.6% in 2016.

From 2014 to 2017, mobile advertising will continue to account for a massive 51% of all advertising dollars spent by advertisers. “We expect mobile advertising to grow by an average of 38% a year between 2014 and 2017, driven by the rapid spread of devices, innovations in ad technology and improvements in user experiences,” stated the report.

There’s still a lot of room for improvement, though, as mobile takes only 6.2% of the total U.S. ad spend in 2014 and accounts for 23.3% of media consumption time. ZenithOptimedia stated that mobile is somehow challenged because “a lot of conventional display advertising does not work well on mobile.” Mobile devices do not have much screen space for advertising, causing consumers to think of mobile ads as “more intrusive” and “annoying.”

An exception to this is the use of social media advertising on mobile devices. “Facebook and Twitter have rapidly restructured their operations for mobile consumption and advertising, and between them are on track to capture 33% of all mobile ad spend in 2014,” stated the report. “This is well above their 10% share of all digital ad spend.”

Programmatic buying also led to an estimated 26% of the increase in traditional display advertising, which could emerge into its full potential in the coming years when partnered with evolving technological solutions.

ZenithOptimedia claims that global ad spend has been held back by weaknesses in both the Japanese economy and the Eurozone. In fact, the annual growth of Japan’s ad market is expected to be between 2% to 3%, with no chance of improving within the next few years. The Eurozone, on the other hand, saw a 15% decrease in ad spend between 2007 and 2013.

Read the full press release here to learn more about ZenithOptimedia’s global ad spend forecast.

Do you think ZenithOptimedia’s statistics for global ad expenditure this year and beyond are accurate? Is your business increasing its ad spend? Let us know in the Comments below.

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