Notwithstanding the online advertising’s good performance along with heavy expenditure prediction due to the coming Olympics and US Presidential elections, the United States’ advertising market will not turn out any extraordinary result next year, predicts Universal McCann, a division of Interpublic Group in its latest report.
The report prepared by Robert Coen, director of forecasting at Universal further envisages that advertising spending in US will increase by only 3.7% next year. In 2007, the industry grew only by 0.7% over last year, while broadly US economy was back on track with 4.7% average. Advertising, as industry thus, is trailing the growth of the broader economy.
US media companies are worried. Threats from digital technologies are looming large over traditional advertising models. Add to that other precarious reasons like housing bubble, rising oil price and a possible economic slowdown.
Bob Coen, director of forecasting at Universal McCann said:
The immediate future of the advertising industry is presently confronted with change, evolution, opportunities and uncertainties. The climate in the US and around the world could be much worse than we now foresee if recession occurs in the United States next year, which we do not presently expect.
It seems this predicted slowdown in advertising is only a reflection of the fact that US economy on the whole is not looking buoyant next financial year. Not surprisingly, a good chunk of above the line advertising budget will be shifted to other forms of marketing which are not recognized as traditional advertising.
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