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TV to account for 42.2% of the global ad market in 2015

carat reportTV advertising will account for 42.2% of the global ad market in 2015, but there are indications that its share is “slowly eroding”, according to new research by global media network Carat. 

Carat’s latest global ad spend report claims that TV will continue to command the highest share of spend this year, remaining particularly popular in Latin America and the Middle East.

However, it claims that that there are signs TV’s share is wearing away having decreased by 1.2 percentage points over the past five years, with TV accounting for a higher 42.7% of the ad market in 2014.

“Growth was boosted last year by a year of events with +4.4% growth. TV spend is predicted to increase by +3.6% this year, picking up in 2016, a quadrennial year, to +3.9%,” according to the report.

Carat predicts that overall advertising spend across all media will increase by US$23.8 billion (€21.8 billion) in 2015 to reach US$540 billion, a 4.6% year-on-year increase.

Digital is expected to continue to be to be “the star driver of growth in the global advertising market,” with a predicted US$17.1 billion increase in spend in 2015, up 15.7% year-on-year outpacing previous Carat predictions. Last year, digital accounted for 21.7% of the total global ad market.

On a regional basis, Carat said that a healthy UK ad market is driving growth in Western Europe, where a second consecutive year of positive 2.8% growth is expected in 2015.

TV advertising revenues in the UK increased by 5.0% in 2014. However, Carat said this was not as high as it previously forecast in the September 2014 report when the UK TV market was forecast to increase advertising revenues by 7.5%.

In North America, the report says that TV continues to command the highest share of advertising spend in 2015 at 38%, but notes there is “a trend of slow decline as spend moves into digital.”

In Canada, digital media spend overtook TV in 2014 to become the most popular media type in the market with 32.1% share.

“The strength of digital continues to dominate discussions and the new distribution of spending,” said Dentsu Aegis Network CEO Jerry Buhlmann, commenting on the Carat advertising expenditure forecasts.

“With a quarter of the global population now owning and relying on their smartphones daily, they are our second brain in our hands. Mobile dominates the way consumers access information, view content, browse products and purchase goods and this is reflected in the innovative services and approach we are discussing with our clients.”

Overall, the report said that online video demonstrates continuing strong growth and is forecast to increase by 21.6% in 2015, with growth partly driven by a shift of investment away from TV.

“Expectations are particularly high for original content. In the US, nearly half (48%) of online video budgets will go to ’made for digital’ video,” said Carat.

The Carat report was based on data received from 59 markets across the Americas, Asia Pacific and EMEA.