UK Advertising’s Nuclear Winter Thaws? GroupM Raises 2010 Forecast, But Online Stagnant

Is that the sound of ice breaking? Marketers, advertisers and publishers will have to wait for the real recovery, but a new revised forecast from WPP’s GroupM shows things are at least going in the right direction. GroupM’s mid-year report predicted UK full-year, all-media ad spend would drop 14 percent year on year in 2009, but that figure is improved to a 12 percent drop — to a 2009 total of £11.3 billion — in a report released on Friday. An earlier minus-three percent prediction for UK ad spend in 2010 is now upgraded to zero.

GroupM says online ad spend will only grow by 2.1 percent growth in 2009, before bouncing back to a 7.3 percent percent lift in 2010 — still a far cry from the 20.5 percent GroupM recorded for 2008. Combined with mobile, online will bring in £3.4 billion in 2009 — but GroupM says that figure grows only slightly next year to £3.67 billion. Still, that narrowly beats GroupM’s 2010 prediction for print spend…

GroupM Futures director Adam Smith: “We still have most media types negative on revenue in 2010, but media value is about innovation as much as price… A high and rising proportion of digital marketing is already performance-based, and raising the ROI bar in traditional media.” So digital is changing the advertising world irreparably — it’s just doesn’t have the growth to match, yet

Here’s the lowdown on GroupM’s UK predictions, from it’s regular This Year, Next Year research series…

— Real UK growth is delayed until 2012 when a five percent lift is expected.

— Mobile advertising will grow by 74.8 percent in 2009 and 50 percent next year.

— After attracting £4.84 billion in ad spend in 2008, print media will bring in £1 billion less in 2009 and £3.61 billion in 2010.

— National newspapers ad spend will be down 16.7 this year, followed by a milder 5.8 percent year on year drop in 2010.

— Regional papers will be down 24.5 percent year on year in 2009, followed by a 4.6 percent decline in 2010.

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