Carat revises ad spend predictions

Media agency Carat has revised its forecast for global advertising spend upwards for 2006 and 2007.

The Aegis-owned agency has changed its estimate of 5.5% growth this year to 5.8%, with 2007 also raised from 5.5% to 5.8%. It says the world’s two largest markets – America and Japan – will see an improving outlook.

Europe remains steady overall, although Carat says 2006 has been a “tough year in the UK advertising market”. Carat says commercial television is “significantly” underperforming on previous years in terms of audience delivery and revenue, and expects revenue to be down by nearly 7%.

The agency also says there has been weak demand in the newspaper sector, particularly on regional titles, and a net growth of 1% overall reflects the strength of online. Total internet expenditure is forecast to grow by 40%, outstripping magazine display advertising for the first time.

Globally, online will account for 5.2% of ad spend in 2006, up from 4.3% in 2005, with a predicted increase to 5.7% of global advertising expenditure in 2007.

Aegis group chief executive Robert Lerwill say the forecasts are “healthy and encouraging”, despite country-to-country variations.

“We are seeing a respectable increase in advertising and marketing investment by brands across virtually all categories,” he adds.

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