As 2012 comes to a close, marketers can reflect upon the results of their significant ongoing advertising spend. Most will maintain the status quo by sinking the vast majority of their budget into advertising. That's good news for the troubled legacy media industry.
Despite the global economic slowdowns, the media advertising sector is expected to continue growing for the next several years -- driven especially by increased spending within the emerging markets around the globe.
eMarketer estimates that total media advertising spend worldwide has risen by 5.4 percent in 2012 -- to just under $519 billion -- that's compared to the 2011 increase of just 3.6 percent.
Spending on adverting will continue to climb at a similar pace throughout eMarketer’s forecast period, which extends through 2016. By that year, eMarketer now forecasts that worldwide media ad spending will top $628 billion.
The fastest growth will come from Latin America, where ad spending was already up by 11 percent this year to $34.66 billion. Furthermore, by 2016, ad spending in Latin America will reach $51.33 billion.
eMarketer believes that Asia-Pacific, Eastern Europe and the Middle East and Africa will also enjoy higher-than-average growth rates, while growth in North America and Western Europe will be significantly slower. This year, Western Europe has struggled to grow ad spending at all, with several major countries posting spending declines.
U.S. ad spending is estimated to rise 4.9 percent this year to $166 billion, which is ranked number one in the world. eMarketer predicts that 2016 spending levels will be near $190 billion. While eMarketer says that their U.S. growth projection is relatively bullish, the forecast of absolute spending is comparatively conservative.
The second ranked country in the world in terms of ad spending is Japan. But China is now forecast to surpass Japan in 2014. China, the third-largest ad market in the world, is growing ad spending much faster than mature markets -- such as the U.S. or Japan.
eMarketer estimates ad spending in China is up 13 percent in 2012. eMarketer also predicts double-digit ad spend growth rates in this massive country through the rest of the forecast period, which will help boost Asia-Pacific and worldwide increases.
As the biggest ad spender in Europe -- the fourth ranked market in the world -- Germany will post near-flat growth of 1.5 percent in 2012, with spending reaching $27.7 billion. This slow growth will continue in Germany throughout the forecast period.
The 2012 Olympics host nation had a relatively good year overall. Ad spending growth in the UK was somewhat better, and closer in line with U.S. growth rates. eMarketer estimates UK spending will have reached $24 billion in 2012.
eMarketer forms its forecasts of worldwide ad spending through a bottom-up approach, based on a country- and region-level meta analysis of various elements related to the ad spending market -- including macro-level economic conditions, historical trends of the advertising market, estimates from other research firms, and consumer media consumption trends.