GroupM Forecasts 6.1% Ad Decline for N.A. in 2010

NEW YORK If you think 2009 is dismal from an ad-spending perspective, just wait until next year. A fresh forecast from WPP's GroupM unit predicts that measured-media expenditures in North America in 2010 will drop 6.1 percent to $151 billion, following a 4.2 percent decline this year to $160 billion.The 2010 decline would mark the third consecutive year of spending decreases for North America. In 2008, expenditures were down 2 percent to $167 billion, per GroupM. Rino Scanzoni, chief investment officer at GroupM, said spending in the U.S. should stabilize this year and next. "We expect a bottoming-out on local media in 2009," he said. "However, we are expecting further contraction on national media -- particularly television -- as clients adjust budgets to reflect a continued pessimistic consumer spending forecast."The global outlook for next year is slightly brighter. GroupM predicts a "mild recovery," with ad spending off 1.4 percent to $411 billion.The forecast covers 70 countries worldwide. The so-called BRIC nations -- Brazil, Russia, India and China -- are expected to lead the recovery next year, GroupM said, while spending in the U.S. and the other G7 nations (Canada, U.K., France, Germany, Italy and Japan) will probably lag behind."Our global forecast for 2009 has finally stopped tumbling," said GroupM futures director Adam Smith. "The 15 countries still reporting positive ad growth in 2009 has become 33 in 2010, and the number could rise as we phase through the year."He added: "China's economic stimulus has already bolstered confidence, and the demand for advertising in Russia will recover quickly if $70-a-barrel oil prices are here to stay."The forecast indicates that the entire Asia-Pacific region will show spending growth in 2010, up 3.2 percent to $117 billion, reclaiming the ground lost in 2009, when full-year regional spending should drop 2.8 percent. Spending declines in Western Europe will ease significantly in 2010 after a sharp 11 percent drop this year to $95 billion. Next year, spending will dip 4 percent in the area to $91 billion. GroupM said that package-goods advertising has remained one of the stronger categories during the recession, while auto and financial have retreated the furthest. TV and out-of-home have added share, on a global basis, during the downturn, while newspapers continue to lose about 1 share point annually.Digital, which accounted for about 10 percent of global ad spending in 2007, is expected to total 15 percent of spending in 2010, GroupM said.

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GroupM Forecasts 6.1% Ad Decline for N.A. in 2010

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