Media buyer GroupM said that despite stronger performances in the U.S. and the U.K., global ad spending growth appears to be slower than expected.
GroupM expects advertising to increase by 3.9% in 2020, compared to its 3.8% growth forecast in June. The media agency also revised its forecast for 20019 to 4.8% growth, down from 5.7%.
The WPP unit released its forecast for the U.S. last week
GroupM said the U.S. remains the largest global ad market at $246 million, representing a 40% share of global advertising in 2020. GroupM released its forecast for the U.S. last week.
Global TV ad revenue is expected to be down 3.6% in 2019, excluding U.S. political advertising. The agency sees global TV ad revenue to stay just under $170 billion in annual revenue each year through 2024.
“Although television arguably remains most effective in helping marketers build their brands, the relative effectiveness of television has likely fallen, at least incrementally. And, the share of budgets allocated toward TV have generally diminished incrementally with each passing year, GroupM said.
“There are many countries where TV advertising is still growing, especially as consumption using internet-connected devices continues to grow, the agency said.
The majority of the global growth is coming from giant digital companies buying ad advertising. GroupM said Alibaba, Alphabet, Amazon, Booking.com, eBay, Facebook, JD.com and Netflix account for $36 billion.
GroupM estimates that digital advertising was worth about $230 billion in 2019, with Google and Facebook racking up about $175 billion in ad revenue.
“Marketers can look at the data included here to gain a sense of the health of their media partners now and over the next several years,” the report concluded. “However, even a media owner in decline may still be investing in new and better ways to connect with audiences. At the same time, other media owners may be healthy in terms of revenue growth but may not necessarily be investing in everything they can to make their ad inventory more effective.”