Global advertising spending is forecast to increase by 4.3% in 2020, according to media buyer Zenith, but with audiences shrinking by 1.6% the advertiser demand will push prices up by 6.1%.
In the U.S. ad spending is expected to grow $4.8% in 2020 and by $39.1 billion between 2019 and 2022. The U.S. and China will account for 56% of all growth in ad expenditures over the next three years.
Related: Global Ad Spending Slower Than Expected: GroupM
Zenith expects U.S. TV spending to drop 2% to $65.992 billion in 2020. It will continue to fall, hitting $63.676 billion in 2022, the agency says.
The decline is across all TV categories. For 2020, network TV is seen dropping 3% to $15.862, national cable is seen slipping 2% to $22.376 billion, spot dips 1% to $25.115 billion and syndication drops 1% to $2.639 billion.
Worldwide, television will show zero growth over the next three years, Zenith said in a report released Monday, with price inflation counterbalancing audience erosion.
“The days when we could find audiences all in one place are long gone. Now, however, technology empowers us to find them wherever they are, online or offline, and win back value for our clients through efficiency and effectiveness – by ensuring that we target and reach consumers with the right message at the right point in the consumer journey,” said Matt James, global brand president at Zenith.
Online video and social media will be the fastest-growing channels between 2019 and 2022. Spending on online video is expected to grow 16.6% and social media by 13.8% as consumption on smartphones rises.
“With the rapid growth of digital content, advanced TV/video and streaming offerings, there is massive opportunity for advertisers to connect with consumers during the content discovery phase,” said Lauren Hanrahan, CEO of Zenith, Moxie and MRY. “We now have the data, technology and consumer understanding to build more personalized experiences that add value to their journey.”
On the macro-economic front, the U.S.-China trade situation is putting a damper on spending.
“If the trade war is settled, we are more confident for 2021, forecasting 4.5% growth in global ad spend despite the absence of the quadrennial events,” said Jonathan Barnard, head of forecasting at Zenith.
