Magna Global: 2014 U.S. Ad Growth Down, Digital Will Drive 2015 Growth

Magna Global just cut its forecast for U.S. advertising revenue growth this year to 5.1 percent from 6 percent. That’s due to the fact that ad spending during the first half of 2014 was weaker than expected.

But the media buying and research firm expects the market to bounce back in the second half of the year, and then to experience its strongest growth rate in a decade by 2015.

“The revision in domestic advertising revenues down to $167 billion this year is mostly due to lower spending on Olympic and political ad campaigns than it was originally expecting, the firm said, in addition to a softer-than-expected market in the first half of the year,” according to the WSJ blog. “Magna Global noted there are many isolated factors behind the weak ad market in the latest quarter, but it is not significantly changing its forecast for the next two quarters.”

As the economy strengthens, Magna Global projects the U.S. ad market to experience its strongest year-over-year growth in ten years in 2015 and to post a new all-time high of $172 billion in advertising revenues. The firm now projects 2015 U.S. ad growth of 3.3 percent, up from its previous estimate of 2.4 percent growth. Excluding the impact of political and Olympic ad campaigns, 2015 ad revenues are expected to improve 4.9 percent, compared with a prior 4.5 percent growth outlook.

Digital is the venue to watch.

“One in three ad dollars next year is expected to be spent on digital media, Magna Global said. The firm now projects digital media to grow 16 percent in 2015, up from its prior view of 13 percent growth,” the report concludes. “Digital media is projected to outgrow TV by 2017, when revenues will reach $72 billion compared with TV sales of $70.5 billion.”


Leave a Reply

Your email address will not be published. Required fields are marked *


Choose your Industry

Select your industry to view the many features and services we provide for organizations like yours: