Zenith Optimedia (ZO), a leading global media services group, has revised downwards its forecast for ad expenditure growth in 2009 to minus 8.5%, from its April prediction of -6.9%, after Q1 came in below predictions. Faced with extreme uncertainty, advertisers in most sectors planned for the worst and cut their costs in anticipation of steep drops in revenue. ?In uncertain times advertising is often treated as a discretionary expense and cut early, despite much research that shows companies maintaining their ad expenditure in a recession come out of it stronger than those that do not,? according to Zenith Optimedia.
In the global advertising arena, China overtakes UK to become fourth-largest ad market this year. Zenith Optimedia predtics that Internet advertising to grow 10% this year, and reach 15.1% share of global ad expenditure by 2011.
According to Pavan Chandra (MD, South & West), Zenith Optimedia India, India has not been hit as much as the global economy due to a high savings rate coupled with strong rural demand. ?As a result most categories have seen a robust growth in advertising expenditure barring real estate, airlines and some financial categories. We expect that these to show signs of revival in Q3/4 2009, ?he said.
Chandra said that forecasts for adex have been as fickle as the monsoons this time. The last two quarters of 2008 were the worst for India but things started looking up after that. ?And they got complicated too. If ones looks at the advertising data by volume we see a tremendous increase on TV and while forecasting we had to compensate for the drop in media prices. On the other hand, cricket and election led advertising was sold at a premium and costs had to be adjusted upwards, ?he added.