Zenith: Ad Sales Forecast For 2008

Posted on 12/4/2007 by Jim Pickerell | Printable Version | Comments (0)

Early this week, U.S. advertising forecasters offered their predictions for the coming year. Robert J. Coen of Universal-McCann said, "Things don't look good, but not as bad as you might fear and will get better, but not next year."

Zenith Optimedia expects 2007 U.S. ad-spending growth to be just 2.5%, down from the 3.7% expansion the company foresaw as recently as last summer. That 2.5% is under inflation, which ran at an annual rate of 3.6% for the first 10 months of this year.

North American ad growth in 2008 is expected to be about 4.1% above 2007. But photographers need to recognize that a big part of this will result in increased spending for the Olympics and the 2008 presidential elections, neither means an additional use of stock photography.

Worldwide spending for newspapers in 2006 was $123,547,000; it's expected to be $124,880,000 in 2007 and $128,410,000 in 2008.  Magazine spending worldwide was $54,471,000 in 2006; it's expected to be $56,133,000 in 2007 and $58,310.000 in 2008. While these are increases in actual dollars, both types of use are declining as a percentage of total advertising spend.

Together, newspapers and magazines represented 41.8% of all advertising spend in 2006 and are expected to represent 40.3% in 2007 and 39.1% in 2008. The rest is spent on television, radio, cinema, outdoor and Internet advertising. T he big growth area is the Internet, where spending was 6.1% of the worldwide total in 2006 and expected to be 7.5% in 2007, 8.7% in 2008 and 9.5% in 2009. ZenithOptimedia expects the advertising revenue from Internet use to be greater than the revenue generated by magazine ads in 2010.

Those Internet numbers break out to be $25,952,000 in 2006, $33,723,000 in 2007 and $41,638,000 in 2008. Internet advertising spend was 48% of magazine spend in 2006 and will be 60% in 2007. It is expected to be 71% in 2008. The Internet uses a lot of still photographs, so in theory, the number of uses lost in magazines may be replaced by additional uses on the Internet.

The greater worry: fees paid to use an image on the Internet have been estimated to be about one-tenth of fee to use the same image in print. As micropayment gains much more traction in this area, the average fees are likely to drop. It is far from a zero-sum game.

Thus, while advertising revenue in general might fulfill Coen's "not as bad" prediction,  the situation for still photographers trying to sell images for ad use might be worse than anticipated.

The fastest-growing ad markets are: Serbia, Qatar, Kazakhstan, Egypt, UAE, Russia, Ukraine, Moldova, Belarus and Romania.

Steve King, CEO of Zenith Optimedia, said that in making forecasts these days you need to split the world into two parts: the industrialized world, which will continue to see sluggish spend, and emerging advertising markets, like China, Russia, India, Mexico and Brazil. He sees the Asia-Pacific region, not including Japan, as the leading advertising growth area.

Finally, Anthony Noto of Goldman Sachs told Reuters that he believes there is a 50-50 chance of a recession in the U.S. in 2008. If that happens, he says ad revenue at traditional media companies could fall as much as 10%.


Copyright © 2007 Jim Pickerell. The above article may not be copied, reproduced, excerpted or distributed in any manner without written permission from the author. All requests should be submitted to Selling Stock at 10319 Westlake Drive, Suite 162, Bethesda, MD 20817, phone 301-251-0720, e-mail: wvz@fpcubgbf.pbz

Jim Pickerell is founder of www.selling-stock.com, an online newsletter that publishes daily. He is also available for personal telephone consultations on pricing and other matters related to stock photography. He occasionally acts as an expert witness on matters related to stock photography. For his current curriculum vitae go to: http://www.jimpickerell.com/Curriculum-Vitae.aspx.  

Comments

Be the first to comment below.

Post Comment

You must log in to post comments.

Stay Connected

Sign up to receive our FREE weekly email listing new stories posted.

Follow Us

Free Stuff

Recent Stories – Summer 2016
If you’ve been shooting all summer and haven’t had time to keep up with your reading here are links to a few stories you might want to check out as we move into the fall. To begin, be sure to complet...
Read More
Corbis Acquisition by VCG/Getty Images
This story provides links to several stories that relate to the Visual China Group (VCG) acquisition of Corbis and the role Getty Images has been assigned in the transfer of Corbis assets to the Gett...
Read More
Finding The Right Image
Many think search will be solved with better Metadata. While metadata is important, there are limits to how far it can take the customer toward finding the right piece of content. This story provides...
Read More
Where Is The Stock Photo Industry Headed?
For new readers, or those who may have missed some of what I have written over the last few months, the following are a list of stories worth looking at to get a sense of where the industry is headed.
Read More
Photography As A Career
It’s that time of year when high school seniors are waiting for college acceptance letters and thinking about future careers. If you know someone who is thinking about photography as a career you mig...
Read More
2014 Stories You May Have Missed
For many the end of the year is a time to review past experiences and consider whether it makes sense to chart a new course in the year ahead. Stock photography has changed dramatically for professio...
Read More
More Stories In 2014 You May Have Missed
Every so often I put together a list of the most important stories we’ve published in the recent past. If you are engaged in the business of stock photography the links below are to stories that we’v...
Read More
Getty: A Three Month Review
In all the excitement about 35 million FREE images it is worth looking back at some of things that have been happening at Getty Images in the last three months. After watching revenue decline for the...
Read More
State Of Stock Photo Industry: 2013
If you’re looking for an overview of the state of the stock photo industry as of October 2013 the stories listed below are a good place to start. Regular readers of Selling-Stock will have seen all t...
Read More
Education Market Shifts To Digital
If supplying pictures for educational use is a significant part of your business plan you need to be aware of how the market is trending toward digital delivery and how that is likely to affect the p...
Read More

More from Free Stuff