Global ad spend may slow, but Canada to remain steady: report

Despite dialed-back expectations thanks to slow economic recovery in some markets, Canada's strong economy means brands are still spending big on advertisement.
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GroupM and Zenith have revised their March 2017 global ad spend forecasts to reflect lower-than-anticipated activity in their latest reports — Zenith has dropped its growth prediction to 4% from 4.2%, while GroupM’s has been revised to 3% from 4.4%.

Despite the dialed-back expectations globally, Canada’s ad industry remains on steady footing, according to Zenith.

While Zenith stated in its report that the strengthening global economy had yet to translate into ad spend, it singled out Canada’s strengthening economy as offsetting lower performance predictions in markets like Thailand, Mexico and Malaysia.

Zenith’s most recent set of numbers forecasts Canada finishing 2017 with $12.58 billion spent on advertising, marking a 4.69% increase from 2016. That number is much higher than the estimated 1.41% increase released in March, which predicted ad spend in Canada would reach $11.74 billion for 2017. The growth is predicted to continue on the upward trajectory into 2018 (4.73%) before slowing slightly in 2019 (3.53%). All growth rates to 2019 surpass what was predicted earlier in the year.

Canada is predicted to be the 10th-largest contributor to ad spend growth from 2016 to 2019, according to the Zenith report, bringing in an average of $1.22 billion in growth per year.

In its revised forecast for ad spend, GroupM didn’t forecast a higher spend for Canada in 2017 and in fact dialed its forecast back just slightly (now at $13.24 billion down from $13.28 billion), however its overall prediction for Canadian ad spend is still higher than that of Zenith. And, while GroupM’s predicted growth rate for the Canadian market is still well below the predicted global average (1.6% growth in 2017 for Canada versus 3% globally), the gap will narrow by 2018 (with a predicted 4.3% growth globally and 3.7% growth in Canada).

Most of the downgrading in GroupM’s global spend prediction came from slower-than-expected economic recovery in China and Brazil, lower spending in Ecuador amidst the aftermath of the April earthquake and Venezuela following political unrest. GroupM’s research found low, single-digit declines in CPG and retail spending on a global level, both of which are among the biggest contributors to ad spend. However, the declines failed to affect Canada significantly.