Worried Economists Rein In Ad Forecasts, But Digital Could Shield Agencies

About-turn. Advertising prospects, which had begun to look up after the 2008/09 economic crunch, are now looking more modest.

Barclays Capital is turning down its 2011 global forecast from 4.5 percent growth to 3.5 percent, with 2012 cut from 5.8 percent to 4.2 percent.

For 2011, Barclays now UK forecasts 14.8 percent growth in 2011, followed by 11.3 percent in 2012

But the bank reckons ad agencies will fare better this time because “balance sheets are in much better shape than before the last downturn and the structural growth drivers of emerging markets and digital are more prominent”.

The lowered forecast is “despite the triple positive effect of the summer Olympics, European Championship football and US presidential elections”. “The slowdown is a function of lower growth across all major markets,” Barclays Capital says.

The big agencies are all buying heavily in to digital, overseas ad houses and, ideally, companies at the intersection of both.