Top Stories / Key Findings
Globally, media owner advertising revenues will grow by +5.4% in 2016, to $480 billion, and by +3.1% in 2017. That compares with +4.8% in our previous forecast (Dec. 2015).
The biggest contributors to the higher 2016 growth forecast are the US (revised from +5.7% to +6.2%) and China (from +5.5% to +8.4%). The biggest downward revision comes from Brazil (from +5.0% to +1.9%).
2016’s major events (US elections, UEFA Euro 2016, Olympic Games, Copa America) will boost ad spending. Neutralizing the impact of those cyclical events, media owners ad sales would still grow by +4%.
Of the 72 markets analyzed by MAGNA, 67 are expected to experience advertising revenue growth this year and only five will decrease, compared to 15 last year.
US advertising sales will grow by +6.2% in 2016 to $179 billion, the strongest growth rate since 2010.
Neutralizing the incremental spending generated by political and Olympic Games (a record $3.5 billion), 2016 advertising growth would be +4.1% (similar to last year) and will slow down to +3.4% in 2017.
US digital advertising sales will equal TV sales for the first time in 2016 (both $68 billion, a market share of 38.5%).
Digital media advertising sales will grow +15% this year while traditional media will be flat (+1%).
Digital media will become the number one media category globally by the end of 2017, as digital advertising sales will reach $192 billion (a 39% market share), surpassing TV at $178 billion (a 36% market share).
Global TV advertising sales will grow by +4.4% to $179 billion and out-of-home (OOH) media by +3.8% to $31 billion). Radio advertising revenues will be flat (-0.2% at $32 billion) and print will continue to decline (-8% to $70 billion).
Digital advertising sales are driven by mobile advertising (+44%), video formats (+35%) and social formats (+43%) and search (+14%) while banner sales will decline (-6%).
Mobile advertising will account for 42% of total digital ads by the end of 2016 and near 50% by the end of 2017.
Linear television advertising sales (+4.4%) will record their strongest growth since 2012, boosted by cyclical events and strong pricing offsetting the continued erosion of viewing.
Western Europe advertising revenues will grow by +3.8% to $100 billion, driven by the UEFA Eurol event and assuming “Brexit” does not happen; Eastern Europe advertising sales will increase by +5.3% to $16 billion.
Asia-Pacific media sales will reach $139 billion (+6%) while recession-stricken LatAm will grow by only +3.3% (previous forecast +5%) despite hosting the 2016 Summer Olympics.
