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Global Advertising Agencies

Global advertising agencies market: $145.6 billion industry by 2018

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2014-02-24 08:07:01 - Global Advertising Agencies - a new market research report on

In 2013, the Global Advertising Agencies market´s revenue is expected to rise 4.3% to $109.4 billion, driven by increasing corporate profit and marketing budgets. Although revenue is growing, the industry´s five-year performance was significantly slowed by the recession and its effect on consumer spending and corporate profit. In 2008 and 2009, many companies cut marketing budgets to mitigate profit declines. Consequently, revenue is expected to increase at an annualized rate of just 1.9% in the five years to 2013.

While emerging markets, including China and Latin America, continue to grow, they are still relatively small compared with major markets, such as the United States and Europe. Growth in emerging markets was not enough to overcome the recessionary declines experienced in developed



regions. As a result, revenue fell 9.3% in 2009. However, the industry has since returned to growth. Reflecting growth in emerging markets and digital advertising, major players have made acquisitions in these areas, contributing to industry consolidation. IBISWorld estimates that in the five years to 2013, the number of firms operating in this industry has fallen 0.4% annually on average to 29,514.

As the economic outlook brightens, marketing budgets will expand and companies will begin to invest in new advertising campaigns. The industry will continue to experience growth in emerging markets and digital media, which have both grown solidly in the past five years. Internet advertising is expected to rise to 20.0% of total advertising spending in 2013, which is about double its share in 2007.

The size of major global players will benefit them in gaining more exposure in emerging markets; their scale means they will be able to make acquisitions and form joint ventures rapidly. An established presence and credentials in a particular region will be a major advantage when competing for clients that are looking to export to that area. Opportunities for smaller firms lie in the digital arena, particularly in uncovering innovative ways to use new media to reach audiences. Revenue is expected to grow an average of 5.9% annually over the five years through 2018 to total $145.6 billion.

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