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Recently, Deloitte published a study which assessed the economic impact of advertising on the Irish economy. One of the objectives of the study was to provide evidence to Government that it should encourage advertising instead of enacting restrictions. There was good reason – In 2013, ad spend as a % of GDP was 0.41% which is exactly the same as in 1980 and down from 0.61% in 2007. It is predicted to be much the same in 2016 at 0.43%.

ZenithOptimedia publishes ad spend data that mainly focuses on ad spend by country and media. The latest release of data published earlier this week reveals that a previously deteriorating situation has changed to stable. Looking at data from 1980, it states that ad spend as percentage of GDP is a better measure of the health of the advertising industry than raw ad spend data, which does not take into account inflation.

The USA has had a long history of ad spend as a percentage of GDP exceeding 1%. In 1980 it was 1.24%, in 1990 1.40% and in 2000 1.52%. As a consequence of the crisis it reduced to 1.01% in 2010. In other markets:

• Australia enjoyed a long period of ad spend as a % of GDP being in excess of the benchmark 1%.
• New Zealand has had periods of exceeding 1% and generally has been near that mark. In 1980 it was 0.91%, 1990 was 1.30%, 2000 was 1.27% and in 2010 1.03%. In 2013 it was 0.98% and by 2016 is predicted to decline to 0.91%.
• Thailand saw only 0.30% in 1980. By 1990 it had doubled to 0.62% and in 2000 was 1.04%. It has retained around the benchmark 1% figure for this century with 1.06% in 2010, 0.99% last year and predicted to be 1.06% in 2016.
• In China, in 1980 ad spend barely registered with 0.01%, by 1990 it had grown tenfold to 0.11%, in 2000 it reached 0.40% and in 2010 an increase to 0.44%. It maintained this level in 2013 with 0.45% and is predicted to be 0.47% by 2016.
• Indonesia has shown strong performance: in 1980 ad spend was 0.14% of GDP, by 1990 it was 0.22%, 2000 was 0.34%, 2010 was 0.61% and 2013 was 0.79%. In 2016 it is predicted to reach 1.06%

For more information, download the report.


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