Carat improves ad spending outlook for this year, 2011

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Global advertising spending is rebounding better than was expected earlier this year. The US market and the online sector are leading the modest recovery, according to media agency Carat.

The forecast for overall ad spending in 2010 improved to a 3.9% increase, including a 1.1% jump in the US. Earlier this year, Carat predicted US ad spending would increase 0.2%. Global and US spending increase forecasts for 2011 also rose to 4.7% from 4%, and 1.7% from 1.4%, respectively.

The US market has bounced back faster than expected from the recession, showing improvement in most product categories and media, according to Carat's estimates. While TV remains the largest medium, digital media will continue to be the fastest-growing, especially paid search ads. Internet advertising will increase its share of total spending to 10.3% this year in the US, according to Carat's forecast.

Globally, Internet advertising will grow faster than any other media, by 13.5% this year, and its share will increase to 11.3% of all advertising spending, pushing it ahead of magazines. Print media is expected to continue to lose market share in 2010 and 2011; newspapers will be down 2.9% this year; and magazines will drop 3.9%, although they are expected to stabilize next year, according to Carat.

"Overall, while the short-term economic outlook remains uncertain, these forecasts are an encouraging sign," said Jerry Buhlmann, CEO of Carat's parent, Aegis Group PLC, in a statement.

He also pointed out that the data is up against a weak 2009, when global spending dropped 9.2%. Even with predicted 2010 growth, spending will only reach 2006's levels.


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