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NEW YORK JPMorgan analyst Alexia Quadrani is now predicting global ad spending to decline by nearly 6 percent this year, fueled by an anticipated 9 percent decline in the U.S.
The U.S. decline will be driven by an expected 20 percent falloff in local ad spending, though Quadrani also expects national ad expenditures to fall by 6 percent. The analyst attributes both anticipated declines to revenue erosion at major advertisers.
Local markets are being hurt by their dependence on “beleaguered” industries such as automotive and retail, small businesses being “eaten up” by larger national chains like Walmart and the “less resilient nature of local businesses to spend in a downturn, which leads to bigger cuts early in a down cycle and a lag in a recovery,” Quadrani wrote in a recent report that highlights macro trends in the ad industry.
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