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Tag: Jerry Buhlmann

  • … And the advertising market in India is forecast to grow by a further 12.5 per cent in 2019

    Dentsu Aegis forecasts 12.5% adspend growth for 2018

     

    By A Correspondent

     

    Dentsu Aegis Network’s latest Ad Spend Forecasts, based on data received from 59 markets, puts global growth at 3.6 per cent in 2018, up from 3.1 per cent in 2017. And the estimated growth for India for 2018 is 12.5%.

    Events will play an important role in 2018, Winter Olympics, Commonwealth Games, Asian games and state elections are all expected to stimulate ad spend growth. However, a slowing of growth in markets like Australia and China can be attributed to multiple contributing factors such as a naturally maturing market, ad fraud and data accuracy issues on top of a general economic slowdown.

    Speaking on the Indian context, Kartik Iyer, President Media Brands and Amplifi – Dentsu Aegis Network India, said: “India is forecast to grow by 12.5 per cent in 2018, up from 9.6 per cent in 2017, reflecting its solid economic growth trajectory. Digital media spend is forecast to increase by 30 per cent in 2018 with 43.6 per cent growth in mobile spend, which will account for 47 per cent of total digital spend in 2018. The advertising market in India is forecast to grow by a further 12.5 per cent in 2019. 2018 is expected to be a growth year considering the stabilisation post GST. Another driver of growth would be the fiscal policies of the government which are expected to be pro spending and supporting the middle income groups. In India, the significant improvement in availability of high-speed networks at a lower cost is making a huge impact in the efficiency metrics of digital media. This will continue and therefore will support the faster growth of Digital advertising. As marketers, we need to be prepared to harness this change and maximise engagement with our customer and thereby deliver higher returns for our brands. As an agency group, DAN has overinvested in this area and today has the largest, most experienced group of companies which are harnessing this rapidly changing area.”

    Trends include:

    • Digital media channels will continue to power ad spend growth, growing globally by 12.6 per cent in 2018, versus 15 per cent in 2017, to reach US$220.3 billion
    • Mobile will go from strength to strength, reaching US$121.1 billion having overtaken desktop as a share of total digital spend in 2017. Desktop will continue to lose global share (-1.5 per cent since 2016), versus mobile’s gains (8.2 per cent since 2016)
    • Digital overtakes TV, by a margin now exceeding previous forecasts. Digital ad spend will account for 38.3 per cent share of total ad spend and TV 35.5 per cent
    • Paid search accounts for the lion’s share (40 per cent) of digital ad spend, with voice-activated devices helping to power its growth. Amazon’s Alexa app was the top app for Android and iPhone on Christmas Day 2017, with the company claiming its devices enjoyed the best holiday season yet
    • Video (24.5 per cent) and social (23.5 per cent) will also drive growth within digital ad spend, powered by smartphone take-up and mobile-video in particular

     

    Commenting on the latest forecasts, Jerry Buhlmann, CEO of Dentsu Aegis Network, said: “The latest ad spend forecasts show a market in transformation, but not recession. The challenge for brands is to navigate an uneven economic outlook alongside a rapidly evolving tech & innovation landscape. In many markets, disruptive innovation – from mobile, voice activation and new ad tech players – is still providing new sources of growth and we forecast this trend will continue into 2018.”

     

    “Succeeding in this environment requires global consistency through appropriate platforms and systems, while also the flexibility and agility to work with a wider ecosystem of tech-enabled solutions. It demands a relentless focus on understanding the consumer, using data to reach real people, driving relevance, addressability and business growth.”

     

    Nick Waters, CEO of Dentsu Aegis Network Asia Pacific, added: “Asia Pacific continues to lead the growth in digital ad spend. With the region’s fast adoption of technology and innovation, there will be a substantial shift towards mobile and smart devices. As a result, mobile online video ads will be the main drivers of growth within digital ad spend across the region.”

     

    “Data continues to be central to our business in Asia Pacific and with better understanding of new technologies, structures and models for business growth, agencies must help brands move from being disrupted to disruptor.”

     

     

    JAN 2018 Ad Spend

  • New ad spend growth forecasts show caution in 2017 but improved outlook for 2018

    Global ad spend to hit $563.4 billion in 2017, notes latest Dentsu study

     

     

    Based on data received from 59 markets across the Americas, Asia-Pacific, Europe, Middle East and Africa, Dentsu Aegis Network’s Ad Spend Forecasts – June 2017 point to a more cautious economic outlook in 2017 than the previous year, with global ad spend growth falling from 4.8to 3.8 per cent. However, conditions are set to improve in 2018 with forecast growth in ad spend of 4.3 per cent. Events will play a key role in 2018, with events such as the Winter Olympics & Paralympics in South Korea, the FIFA World Cup in Russia and the US Congressional elections all expected to stimulate ad spend growth.

     

    Despite concerns about the economic impact of Britain’s decision to leave the European Union, UK ad spend growth held up better than expected in 2016 at 6.1 per cent. While there are signs of caution in 2017, with growth dipping to 4per cent, 2018 is forecast to see growth bounce back to 5.9 per cent. A similar picture unfolds in the United States, where a slowdown to 3.6 per cent is forecast for 2017, followed by a slight improvement in 2018 to 4.0 per cent. The United States also remains the largest market in the world, accounting for 37.7 per cent of global advertising spend in 2017. Advertising spend in emerging markets continues to outpace developed economies. For example, ad spend growth in India is forecast to grow at 13 per cent in 2017, while China is the second largest market in the world by share of advertising spend—remaining the only emerging economy to feature in the top five largest ad markets.

     

    The forecasts show how digital technology continues to disrupt and drive innovation in the way brands connect with their consumers. In 2017, we forecast that advertising spend on mobile will overtake desktop, reaching 56 per cent in terms of share of global Digital advertising spend. In 2018, mobile ad spend will grow further to account for a total of US$116.1 billion. With smartphone subscriptions set to reach 4 billion by 2025 and about a third of consumers reporting that their smartphone is their primary source of entertainment, we can expect to see this trend continue to strengthen.

     

    Furthermore, our forecasts suggest that in 2018 digital will be the top media in terms of global share of spend, taking over television for the first time. Digital’s share of total media spend is predicted to reach a 37.6 per cent share in 2018 (up from 34.8 per cent in 2017), versus 35.9 per cent for television (down from 37.1 per cent in 2017), amounting to a total value of US$215.8 billion. Reflecting the continued disruption by digital technology of the print media industry, Paid Search (advertising within the sponsored listings of a search engine) is forecast to overtake traditional print media (newspapers and magazines) in 2018. Print media has been on a downward trajectory for some years now, but will likely fall to a 13.8 per cent share of total spend in 2018 (down from 15.1 per cent in 2017) while paid search is forecast to grow to 14.6 per cent up from 13.6 per cent in 2017.

     

    While digital ad spend is growing rapidly and set to overtake television, within digital there are a number of new sources of growth that point to the future of advertising. For example, in 2017, online video is set to grow by 32.4per cent; social by 28.9per cent; and programmatic (i.e. automated ad buying) by 25.4 per cent. Looking ahead, brands will need to embrace the potential of disruptive technologies such as virtual reality, artificial intelligence and voice activation. However, research suggests that only 8per cent of brands currently intend to use virtual reality for advertising purposes.

     

    Commenting on the latest ad spend forecasts, Jerry Buhlmann, CEO of Dentsu Aegis Network, said:“We are reaching a tipping point in ad spend now as digital overtakes television, mobile overtakes desktop and paid search overtakes print. Digital and data must now be the default settings for advertisers. Evolving to people-based marketing rather than audience-based marketing and using data to increase address ability is essential for brands to manage tighter conditions in 2017 while positioning themselves for future growth.”

     

    “At the same time, the challenge for brands is to ensure that they are ready to embrace the potential of new innovation. As technologies such as virtual reality and voice activation become more prominent, brands must ensure that they remain relevant by creating new value for their consumers.”

     

    Commented Kartik Iyer, MD, Carat India: “India continues to be amongst the few countries seeing growth rates in double digits. While this may be slightly lower than past expectations owing to various market drivers like demonetisation and GST, the growth is clearly expected to continue. Driving this growth is digital with a growth rate of over 35per cent which is far in excess of that seen by other more traditional media. And with digital quickly progressing on its path of becoming the Go To media for entertainment, this trend is also expected to continue. Other media like TV and cinema are expected to grow at around 12per cent while Radio and OOH should see a growth of 10per cent and Newspapers around 8per cent. Another medium that is driving growth is that of ambient (at over 15per cent growth rates). Considering the changing retail environment, the medium, in tandem with digital is becoming pivotal for delivering quality engagement with consumers.”

     

    Figure 1: Growth in advertising expenditure 2016-2018 (selected economies)


  • Following 2014 Acquisition of US-Based MKTG INC, Network Framing Up Sports and Entertainment, Experiential and Lifestyle Capability Worldwide

    Dentsu announces launch of new agency MKTG

    By A Correspondent

     

    Dentsu Aegis Network announced the formation of a ninth global network brand, MKTG, the lifestyle marketing agency it acquired in August 2014. The move further strengthens the network’s sports and entertainment, experiential and lifestyle marketing offering and continues its expansion around the globe.

     

    In addition, Out-of-Home agency Posterscope’s experiential arm, psLIVE’s offices across Europe and Asia Pacific, South Africa’s Crimson Room, Australia/New Zealand’s Apollo Nation and leading US-based sports and entertainment consultancy Team Epic will be realigned as part of MKTG over the next 12 months.

     

    Leveraging its collective experience, global network and resources, the realigned agency will provide clients with a truly integrated through-the-line service offering including sports and entertainment consulting, experiential marketing, sponsorship identification, negotiation and activation, hospitality, strategy, research and insights, custom measurement, digital and creative capabilities, content development, design and retail marketing.

     

    “As a network, we are constantly evolving to meet the demands of our clients, to be responsive to the needs and desires of consumers and to remain pioneering in the evolution of our industry,” said Jerry Buhlmann, CEO Dentsu Aegis Network and Executive Officer of Dentsu Inc. “The tremendous growth and importance of lifestyle marketing made it clear that strategically it was time to unify our like-minded businesses as one single brand. We are completely committed to building out our lifestyle marketing offering and integrating the combined strength of these services to deliver on a far larger and broader scale.”

     

    “Something that sets Dentsu Aegis Network apart is that we are constantly reevaluating our businesses and are willing to reorganise ourselves to best serve our clients; ultimately providing the best value we can,” said Annie Rickard, Global Brand President, Posterscope; Global Chairman, MKTG. “With this realignment, we can now provide a seamless offering across lifestyle, sports and entertainment for our clients and allow all of our agencies to benefit from this platform.”

     

    “We are truly excited about this next chapter and the opportunity to work across the network to deliver unrivaled lifestyle marketing solutions for brands,” said Charlie Horsey, Global Brand President, MKTG, CEO MKTG USA. “The realignment will also greatly benefit our current long-standing client base and our employees who now have the ability to plug into resources and opportunities around the globe.”

     

    Ashish Bhasin

    Ashish Bhasin, chairman & CEO South Asia – Dentsu Aegis Network, chairman Posterscope and psLIVE – Asia Pacific said, “In India, the lifestyle marketing solutions market is growing at twice the rate of the ATL market. With Fountainhead, a leading player in India and MKTG, a leading global player, we now will have the best offering of global standards, through Fountainhead MKTG, which will make us the best lifestyle marketing solutions agency in India. This is another big step forward in helping us achieve our mission of being the second largest agency group by end 2017 in India, overturning for the first time the existing ranking which has historically been in place for over 80 years in India.”

     

    As the agencies transition towards operating as one global brand, MKTG will grow from 450 full time employees and 7,000 brand ambassadors in the United States, to nearly 1,000 full time employees in 14 countries, providing a truly global lifestyle marketing solution for clients. MKTG will be headquartered in New York City.