The forecast, made by US industry veteran Robert Coen, predicted that adspend would rise to $249.3bn (£157.6bn) in 2003, a 5% increase compared with a 3% increase in advertising forecast by Zenith Optimedia. A third prediction from Carat comes even lower than Zenith's, with a view that global adspend will rise just 2.3% next year.
The figure will likely surprise some as it surpasses the height of the dotcom boom in 2000 when the market was worth $247.5bn. On a worldwide basis Coen, who is director of forecasting at Universal McCann, said the market would rise 4.9% to $470bn in 2003.
"Except for the uncertainties over Iraq, we would expect a much improved rate of growth for US advertising next year. The shakeout in high-tech, financial and dotcom spending has been a drag on ad growth in 2001 and 2002, but the worst appears to be over," Coen said.
Coen said that 2002 expenditures in the US are expected to climb 2.6% to $237.4bn. "The correction seems to be about over. The economic climate will look pretty good. Not a boom, but better than 2002, which was positive," he said.
Coen's Insider report also said that big spending clients are returning and with more to spend. "Most of the biggest users of advertising are returning to much higher ad budget levels. If this trend continues well into the new year, it could stimulate good ad growth in 2003."
Coen's report cited telecoms, beers and wines, tourism and airlines as major areas of growth. He also noted that cigarettes continue to decline and that the financial sector is also spending less than it did a year ago.
However, he said on balance the media marketplace is firming up, and with "reasonable economic growth next year, we should see moderately better advertising spending growth, barring unforeseeable terrorist and Iraq developments".
Both forecasts give a clear indication that a recovery is under way, offering some much-needed cheer for industry executives. However, like Zenith, Coen who is traditionally more bullish does not expect to see a significant rebound until 2004 when the industry will feel the benefit of both the Olympic Games and US presidential election.
"It will be 2004 before we really see the advertising moving into a trend that outpaces the economy," Coen said.
He also said that the industry was in a better position to ride a second Gulf War than it was in 1991 when Kuwait was liberated by the international coalition.
"Despite the clouds of another Gulf war, the economic and business climate in 2003 are expected to be more favourable than they were at the beginning of 1991," he said.
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