Advertising Expenditure Expected to Increase by up to 47% over the next decade

The new report explains that it is vital to maintain a sense of perspective in the current advertising climate when considering long-term trends. Over the past two years, many sectors of UK advertising have suffered considerable revenue losses, often following a long period of growth.

Under these circumstances, it is particularly important to produce a long-term projection that helps to distinguish short-term cyclical blips from significant and relatively permanent changes in the factors governing UK advertising growth. It is clear that hopes of a rapid bounce back to prosperity have not yet been realised. However, advertising expenditure has recovered from all previous post war recessions, and the Advertising Association remains optimistic that this time should be no different.

In new additions to the report format, the most obvious long-term threats to advertising are analysed, with particular reference to the differing effects they might have on various media. The report concludes that there is a good chance of significant growth in media advertising expenditure over the next decade, as shown in the table below:

Table: High and Low Ten Year Forecast Options (£m at constant 1995 prices) Year High Option Low Option

Total Display Classified Total Display Classified

2003 11,000 7,513 3,487 10,800 7,398 3,402

2013 15,650 10,845 4,805 12,950 9,195 3,756

Note: Figures exclude expenditure on the Internet and direct mail

Source: AA's Long Term Advertising Expenditure Forecast, available exclusively from the World Advertising Research Center (WARC)

In the absence of major threats to advertising, real growth is projected to rise by 47% between 2002 and 2015 on the 'High Option'. Even on the 'Low Option', assuming developments such as the Internet and a generally depressed stock market have a harmful effect on advertising expenditure, 16% real growth is projected over the same time period.

The Advertising Association's Long Term Advertising Expenditure Forecast: Forecasts from 2003 - 2015 is available (price £495 for Advertising Association members, £995 for non-members) Tel: 01491 411 000

This article was first published on brandrepublic.com