- Steve McClellan

NEW YORK Publicis Groupe's Zenith Optimedia has downgraded for a third time this year its ad expenditure forecast for 2008. The agency now predicts worldwide ad spending will rise 4 percent this year, down from the nearly 7 percent gain it projected when it last ran the numbers in June.

The media shop also reduced its forecast for 2009 to 4 percent from 6 percent.

The reason for the downgrade, ZO said, is primarily the "financial shock caused by the bank failures during the latest phase of the crisis in financial markets, which has spread uncertainty and undermined confidence in the wider economy."

In the U.S., ZO's new growth figures are more tepid. It said 2008 growth might hit 1.6 percent, versus the 3.4 percent it foresaw in June. Next year, growth will be less than 1 percent, versus the 2.6 percent it believed would occur in June. "Fears for the future will cause consumers to cut their spending, while companies carefully inspect their budgets to find cost savings," the shop said.
 
Rino Scanzoni, chief investment officer at WPP Group's GroupM, believes next year's spending will be flat at best and possibly down.
 
Another widely followed forecast, from Interpublic Group's Magna, won't be revised until December.