Zenith tips Asia spend will rebound to US$71b

HONG KONG: Adspend in Asia-Pacific is forecast to rise a modest two per cent next year to US$71.2 billion after this year's likely dip of an estimated one percentage point, according to figures released by Zenith Optimedia. By 2004, total regional spend is expected to hit US$78 billion, according to Zenith In the meantime, Zenith regional director, Roland Crouch, said the outlook was cautious because Japan and Korea - two of the biggest advertising markets in Asia - are bearing the brunt of the current economic slowdown and the after-effects of September 11. The level of advertising spend in Japan this year slipped one per cent to US$41.6 billion, while Korea's tumbled 10 per cent to US$5.9 billion. Both countries are tipped to turn in a flat performance in 2002. The regional forecast, however, is better than expected because the worst-case scenario - an adspend contraction - had looked increasingly likely after the September terrorist attacks on the United States. Major markets like Hong Kong and Singapore are expected to put on seven per cent and two per cent respectively this year. With Korea and Japan ailing, China and India have stepped in to hold up regional advertising spend levels. China's advertising expenditure shot up five per cent to US$5 billion in 2001 and the forecast is for the figure to jump another nine per cent next year. India surged 10 per cent to US$1.75 billion and another 10 per cent jump is on the cards for 2002. Crouch believed that a contraction was unlikely, even in the worst-case scenario. "People can slash and cut their budgets but at some point they must start investing in their brands again to keep them alive." He added that China would likely continue growing strongly because of the country's entry in the World Trade Organisation and its hosting of the Olympic Games in 2008. India is another nation on a fast track growth curve. Mahushree Ramani, brand communications director of Zenith India, said: "Much of the growth is being fuelled by the growth of the middle class, including in second tier cities. However, the biggest change has been that the country has moved from being savings to spending-oriented." Global adspend fell three per cent this year to US$324.9 billion, however, Zenith Optimedia predicted the figure would rebound in 2002, edging up about one per cent. Crouch said that the forecast took into account expected discounts in each market in order to understand the real underlying spends. "Our offices in markets where we have a presence have been in rate negotiations with client and media owners for next year, so we have a good feel for where the market is in terms of pricing." GLOBAL ADSPEND FORECAST (USdollars M) 2000 2001 2002 2003 2004 North America 149,572 141,039 139,166 141,642 147,687 Europe 77,572 75,971 77,290 80,282 84,285 Asia-Pacific 70,464 69,760 71,188 74,234 78,034 Latin America 21,172 20,775 21,682 23,685 26,118 Rest of the world 8,720 8,824 9,433 10,346 11,428 Major media total 327,500 316,369 318,759 330,189 347,551 Internet 7,661 8,488 9,709 11,220 12,903 Total including internet 335,161 324,857 328,469 341,409 360,454 SOURCE: ZenithOptimedia

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