"Global Advertising Expenditure Growth Forecast (2018–2020)" Released

The text of the Dentsu Inc. news release distributed on January 11 is as follows.

---

January 11, 2019

◆Global advertising expenditure growth rate for 2018 projected at 4.1%
Driven by China, the UK, Brazil, and others, the previous forecast (June 2018) of 3.9% has been revised upward to 4.1% in this latest forecast (January 2019).

◆Growth projected at 3.8% in 2019 and 4.3% in 2020. 2019 marks the 10th consecutive year of growth, with total advertising expenditure reaching a record high of US$625 billion.
・Growth in 2019 is expected to be 3.8%, primarily driven by the Asia-Pacific and North America regions.
・In 2020, against a backdrop of global economic growth, all five regions (North America, Western Europe, Central and Eastern Europe, Asia Pacific, Latin America) are expected to exceed 2019's growth rate.

◆By medium, digital surpassed television for the first time in 2018 and exceeded a 40% share in 2019.

Dentsu Aegis Network (Headquarters: London, UK), the overseas headquarters of Dentsu Inc., has compiled its "Global Advertising Expenditure Growth Forecast" (※1) based on data collected from 59 countries and regions worldwide. This forecast is revised and updated with new projections twice a year. This update revises the 2018 and 2019 forecasts and introduces new projections for 2020.

As a result, the global advertising expenditure growth rate for 2018 is now projected to be 4.1% (previous forecast in June 2018: 3.9%). Against the backdrop of global economic growth, the forecast anticipates continued robust growth driven primarily by digital advertising, with a 3.8% increase for 2019 (same as previous forecast) and a 4.3% increase for 2020 (new forecast). (See Figure 1)

■Digital Advertising Driving the Global Advertising Market

Global digital advertising expenditure is projected to maintain double-digit growth: 13.8% in 2018 (previous forecast: 12.6%), 12.0% in 2019 (previous forecast: 11.3%), and 10.8% in 2020. (See Figure 2)

In 2018, digital advertising expenditure accounted for 38.5% (※2) of total global advertising expenditure, surpassing television advertising expenditure (35.4% (※2)) for the first time. This share is projected to grow further to 41.4% in 2019 and 43.8% in 2020 . (See Chart 3)

Furthermore, among the 59 countries and regions covered in the forecast, digital is projected to become the top medium in terms of advertising expenditure share in 26 countries and regions in 2019, including the world's largest advertising market, the United States.

■2019 Forecast Overview

Global advertising expenditure growth is forecast at 3.8% (same as previous forecast).

Total advertising expenditure is projected to reach US$625 billion, surpassing the US$600 billion threshold set in 2018.

By medium, digital will continue to drive market growth worldwide. While print media faces continued challenges—newspapers at -7.2% growth and magazines at -7.0%—outdoor/transport advertising is projected to grow 4.0% due to the spread of digital-ready equipment, and radio is expected to grow 1.1% benefiting from the proliferation of smart speakers. This trend is expected to continue into 2020.

■Japan Market Conditions

Japan's advertising market is projected to continue its low growth below 1% in 2019, following 2018. While 2018 saw positive effects from major sporting events, repeated natural disasters led to widespread restraint in advertising activities, and rising future anxieties contributed to stagnant consumer spending. In 2019, the macroeconomic indicators underpinning advertising expenditure forecasts also show a downward trend, partly due to the consumption tax hike. In 2020, with the Tokyo Olympic and Paralympic Games scheduled, the advertising market growth rate is projected to recover to 2.4%.

<Chart 1: Growth Rate Forecast by Country/Region>

<Chart 2: Growth Rate Forecast by Media Type (Worldwide)>