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Continued improvement in Japan, the world’s second biggest advertising market, and the growth of internet marketing worldwide has led Carat, the international media buying group, to increase its forecasts for global advertising spend.
Carat estimates global advertising will grow by 6 per cent at current prices in 2006 and 5.8 per cent next year, compared to previous forecasts of 5.7 per cent and 5.5 per cent respectively.
The internet will continue to drive overall growth in the most significant advertising markets, including the US, Japan and France, according to the forecast.
In a sluggish overall UK advertising market, Carat predicts web advertising revenues could also overtake magazine display advertising this year.
The figures put Carat, part of Aegis, the UK-listed buyer and market research group, at the higher end of advertising forecasts, compared to recent predictions from media buyers at WPP and Publicis.
The pick-up in Japan - which Carat now expects to grow by 2.2 per cent in 2006 or more than double the media buyer’s previous figure - is the most significant regional change in the new estimates.
After a “lengthy deflationary period”, Japan has seen a “near doubling of spend on PC-based and mobile internet”, Carat says.
Aside from China, other Asian economies which are predicted to show double-digit increases in 2006 advertising spend include India, the Philippines and Indonesia.
These growth rates are expected to persist in 2007 in contrast to the US and europe which are both forecast to record slower growth next year.
In line with other forecasters, Carat predicts US advertising spend will rise by 5.4 per cent this year and by 5.2 per cent next. In Europe, the figures are 4.4 per cent in 2006 and 4.1 per cent for 2007.
However, both France and Spain are expected to grow faster than the european average this year. Notably, Carat - which has a strong position in French media buying - has upped its forecast for French advertising growth this year from 2.7 per cent to 4.8 per cent.
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