Universal McCann has tailored back its estimates for 2005 advertising spending growth, now predicting ad growth over 2004 to be up 5.7 percent in the U.S. and 5.9 percent overseas. The 5.8 percent worldwide increase is down from the 6.1 percent increase the company had predicted in December.
Robert J. Coen, senior vice president and director of forecasting at Universal McCann, says that worldwide advertising expenditures are now expected to total $575.1 billion.
Coen's "Insider's Report" suggests advertisers likely will have difficulty improving on 2004 revenues, which were fueled by the Summer Olympics and electoral battles. Coen adds that the stock prices of most national marketers are still 10 to 15 percent below their peak levels in 2000.
Coen’s report also says that internet marketers continue to increase their spending for ads in traditional media. Consumer media advertising by internet companies is expected to hit $3.59 billion in 2005, a 30 percent increase over 2004.
However, overall internet spending on pure advertising or persuasive messages (not including search-related ad spending) has showed signs of moderating. In the first quarter of 2004 revenues for all types of internet ads were reported to have increased 28 percent over 2003, but in the first quarter of 2005 spending had reportedly increased just 8 percent over 2004, according to Coen.
