Dentsu Aegis dials back ad spending projections

The agency's ad spend report downgrades Canada's projections, showing no expected growth for 2017 at all.
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Dentsu Aegis Network has released its latest global ad spending forecasts for 2018, becoming more conservative in its estimates.

Compared to global spending projections, Canada has seen a more drastic dial back in expectations from the company’s previous report in June. After ad spending grew only 0.1% in 2016 (despite a previous forecast of 3.1%), Dentsu Aegis estimated that there was no growth recorded  for 2017 after previously predicting growth of 3.1%.

When the Canadian market returns to growth in 2018, Dentsu believes it will be 1.1% (previously set at 2.7%).

Dentsu Aegis’s previously-predicted global spending growth of 3.8% for 2017 has been dialed back to 3.1%, while the 2018 growth is been forecasted at 3.6%, down from 4.3%.

(Back in June, the company had also reported overall global spend had grown by 4.8% in 2016. The new report adjusts that total downward to 4.7%.)

Media breakouts

On an international level, it is estimated that TV spend will have seen a decrease of 0.9% for the year of 2017, but will return to positive growth at 0.5% in 2018.

The network’s numbers indicate that newspapers will continue to decline, at 9% for 2017, and 7.9% for 2018 (both predictions are bigger declines than first published in the June report). Magazine spend will also see a decrease sharper than initially thought – 7.2% in 2017 (previously set at 2.6%) and 5.9% in 2018 (previously at 2%).

Radio, however, will see small spending increases, at 0.5% for 2017 and 1.3% for 2018. Also set for growth are cinema (4.7% for 2017 and 4.8% in 2018), OOH (3% in 2017 and 2.4% and 2018).

Digital spending is, perhaps unsurprisingly, also expect to grow. With an increase of 15% estimated for 2017 and 12.6% set for 2018, digital is seen as a major global growth driver. Dentsu Aegis’s study stated that sporting and political events have continued to partner with platforms such as YouTube, Facebook and Twitter on live-streaming and content deals as they battle for exclusivity and what Dentsu Aegis calls “‘moments’-driven advertising.”

By 2018, global digital spend is estimated to reach $275.9 billion (CAD). Of that spend, $151.7 billion will be on mobile. With digital representing 38.3% of ad spend (which is predicted to his $720.4 billion CAD), Dentsu Aegis believes it will overtake TV’s share just slightly (35.5%).

Dentsu Aegis also believes the growth in voice-activated devices will propel paid search (which is predicted to represent 40% of digital spending in 2018). This was based on a high number of downloads for apps and skills for the Google Home and Amazon Echo home assistants. According to Dentsu Aegis, those downloads surpassed Adroid and iPhone downloads during Christmas day 2017.

Programmatic spend will also rise by 23% in 2018.