Zenith media calculates that companies spent $1.46 per person per day advertising to Americans last year. Given that money in cash, we might not have needed the tax rebate.
The U.S. continues to strut its stuff in latest edition of Zenith's Advertising Expenditure Forecasts. Our ad market remains the largest in the world, accounting for 44 percent of total planetary pluggery. And it also retains the top rank in advertising per capita among the 56 nations covered. But just barely: Hong Kong, the runner-up, may overtake us this year, since our ad economy looks to be shrinking while Hong Kong's is forecast to climb by more than 5 percent. (WPP-with Ogilvy & Mather, J. Walter Thompson and a stake in the Dentsu/Young & Rubicam venture-is a leader in that market, and saw its business there rise by more than 10 percent through the first half of 2001.)
The U.S. has not been on top in terms of advertising as a share of gross domestic product-GDP being the broadest measure of an economy's size-since 1991, when New Zealand displaced us. This year Zenith believes we'll come in sixth, behind Hong Kong, Portugal, Hungary, Greece and the Czech Republic.
Hong Kong has been a star performer in Asia. Immune from the softness afflicting Japan, the region's largest economy, it's still the world's second-largest ad market, at 15 percent of the world total. Many markets surged beginning in the 1990s from the advent of commercial television-Hungary and the Czech Republic, for example. But in Hong Kong, newspapers have a significantly peppier 10-year growth rate. In fact, Hong Kong is one of the few important global markets where print accounts for a larger share of ad receipts than broadcast.
Hungary has generated double-digit ad growth rates, with the first digit typically more than a 1, since it started edging into the free-world economy. Commercial TV became much more widely available in 1998, and a corresponding rush of advertisers jumped to buy spots. Competition spread to everything from dial tones to detergents, and new advertisers arose to gobble up the ad capacity. Zenith expects Hungary's ad market grow by "only" 20 percent in 2001.
TV advertising took off in the Czech Republic in 1993, jumping to 43 percent of the national total from virtually nothing. It now has more than a 50 percent share in that country, compared with the one-third more common in the rest of Europe.
Portugal joined the European Common Market in 1985, and its economy has blossomed since, though it's still below the European averages on most measures. Economic development there, as well as in the former Eastern Bloc nations, has a triply salubrious impact on advertising: It stimulates competition (more clients), accelerates the growth of a middle class (more consumers) and typically results in an expansion and liberalization of media.
The multinational ad-agency holding companies will depend on these "fringe" markets for a larger share of revenue growth this year, since contributions from major players such as the U.S., U.K. and France, according to Zenith's forecasts, will shrink.
Alan Gottesman, ADWEEK. August 27, 2001
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