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The economic and political uncertainty that has characterized 2016 will contribute to a slowing global ad spend next year, the lowest growth rate recorded since the 2008-2009 recession.
Global media owners' net ad sales are forecast to grow by 3.6 percent in 2017, compared to 5.7 percent in 2016, according to a report by MAGNA, IPG Mediabrands' research arm. The total spent by brands globally on advertising in 2016 was $493 billion.
While 2016 was a bumper year for ad sales in North America, with a $191 billion spend boosted by the Olympic Games and US Election campaigns ($3.5 billion), 2017 will see the region's growth rate slow to 1.8 percent, the most significant market slowdown.
Western Europe will see a noticeable drop in growth in 2017 to 2.4 percent among uncertainty post-Brexit and the general elections in France and Germany, while Central and Eastern Europe will both grow by around 5.6 percent, a similar pace to 2016.
Asia-Pacific is forecast to see a growth rate of 5.4 percent, which is similar to this year's figure. Meanwhile, Latin America's ad spend is set to grow the most, at 6.2 percent, helped by the 2016 Olympic Games and a general economic recovery.
While the global growth rate in ad spend is set to slow next year, MAGNA states that this is still "faster than what should be expected in the current economic environment".
It suggests that this is due to an increasing spend on search marketing and social media, with Facebook and Google together controlling 54 percent of the global digital advertising market, up from 44 percent last year.
Programmatic technology, which automates online ad placement, will continue to be "a key driver of media-buying activity and innovation," says MAGNA, and is forecast to be worth $42 billion globally in 2020. The U.S. is the largest market for programmatic advertising, followed by China, Japan and the U.K.
MAGNA expects global digital ad sales to grow to $299 billion by 2021, making up 50 percent of the market. Australia is likely to be a big spender here, with 65 percent of its ad budgets going on digital by 2021, while China is likely to spend 59 percent and the U.S. 56 percent.
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