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Ad Industry Plunge to Deepen, GroupM Says

Mar 31, 2009  •  Post A Comment

GroupM, the world’s biggest media buyer, sees a deepening plunge for the U.S. advertising industry with a new, lower, forecast calling for a 4.3% drop in spending in 2009 and another 6.8% in 2010.
“Our figures are based on our own proprietary revenue data base across media,” said GroupM chief investment officer Rino Scanzoni. “Any optimism we feel about the U.S. this year is expected to be mitigated by a further spending decrease in 2010.”
For TVWeek’s comprehensive coverage of how the recession is affecting the TV industry, visit the Economic Crisis Navigator page.
Back in December, GroupM had forecast a 3% decline in the U.S. for 2009.
Mr. Scanzoni said that that 2010 was expected to show a more severe decline as a result of marketing budgets that were devised in the throes of the current recession.
He also said the stimulus package provided by the U.S. government is not expected to have an immediate positive impact on ad spending because it does little to drive consumer spending in the face of high unemployment, a weak housing sector, and a resurgence of commodity inflation in the short run.
Worldwide, GroupM expects a 4.4% drop in spending for 2009.
“The 2008/2009 period is now a more serious advertising recession in scale, duration, and relative to the global economy, than the extraordinary 5.1% real-terms post-dotcom global advertising correction of 2001,” GroupM Futures Director Adam Smith said.
(Editor: Baumann)

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