Despite fears of a recession, the global advertising market is still on track to grow 8% in 2022
Despite fears that the global economy is heading into recession, the international advertising market continues to deliver steady growth. According to data from media agency Zenith, global advertising spend is on track to grow by 8% in 2022, buoyed by mid-term election activity in the US and two major sporting events – the Winter Olympics and the soccer World Cup.
- Zenith’s latest Advertising Expenditure Forecasts report puts the global advertising growth forecast at 8.0% for 2022, down slightly from the 9.1% it predicted at the end of 2021, but still healthy. US mid-terms, the Winter Olympics and the unusual timing of the World Cup, held in Qatar during the busy winter advertising period, have supported growth for the year.
- Marketing spending remains stable despite weakening macroeconomic conditions and falling consumer confidence in the face of high inflation. Zenith says post-pandemic demand for the travel and entertainment experiences is bolstering spend and business confidence is generally high.
- Price inflation is also a factor in revenue growth; television advertising has seen cost increases of between 11-13%. This has in turn pushed advertisers toward digital alternatives. Online video prices – up by just 7% – have attracted attention and online video and social media spending are forecast to grow by 15% annually to 2024. Jonathan Barnard, head of forecasting at Zenith, said:
Online video is steadily narrowing the spending gap with television, and will be half as large as television by 2024.
- Global advertising expenditure is forecast to increase by $58 billion in 2022. It is expected to reach $781 billion, up from $723 billion last year. Most of the increase will come from the US, which is predicted to grow by $33.0 billion in 2022. Almost 60% of the additional spending added to the US ad market this year will be in digital.
- China (9.1%), Japan (6.2%), and the UK (5.8%) contribute the next greatest share of global growth. India takes the fifth spot on the growth chart, accounting for 4.6% of the growth in adspend for 2022. Despite being only the 12th largest global ad market, India will be the fastest-growing in percentage terms, up more than 20% in 2022.
- Looking regionally, Zenith’s growth forecasts for North America (12%), MENA (7%) and Western Europe (6%) are unchanged. Latin America was downgraded slightly from 9% to 8%, but Asia Pacific was upgraded from 6% to 7%, thanks to India’s strong performance. Russia’s invasion of Ukraine will cause a 26% decline in adspend in Central & Eastern Europe.
In a separate report, crypto-news site Bankless Times is reporting that Argentina is the fastest-growing digital ad market in the world. With a growth rate of 64% for 2022, it features strongly in the Latin American market.
Latin America dominates the digital advertising growth chart with Colombia (44%) and Peru (36%) second and third on the global growth chart. Chile was fourth with an annual growth rate of 35%.
Growth is more sedate in more established digital advertising markets, growing from a higher revenue base. The United States only made it to eighth position on the global growth chart, posting just under 18% for 2022. Leading European growth, France and Germany are 9th and 10th on the chart, with similar growth to the US at around 17%.
This piece was originally published in Spiny Trends and is re-published with permission. Spiny Trends delivers updates and analysis on the industry news you need to stay on top of if you’re running a media and publishing business. Subscribe to a weekly email roundup here.