LONDON (Reuters) - Two leading forecasters of global advertising trends trimmed their predictions for growth in ad spending this year, due to a sharp slowdown in Russia and economic weakness in the euro zone.
Zenith Optimedia, owned by advertising agency Publicis, had downgraded its forecasts in September and cut them again on Monday. They now expect global advertising expenditure to rise 5.1 percent in 2014 and 4.9 percent the year after.
The forecasts compare with September’s downgraded expectations of 5.3 percent increases in both years.
GroupM, owned by WPP, also trimmed its forecasts for 2014 growth to 3.9 percent, down from 4.5 percent, due to tougher than expected conditions in China, Brazil, Israel, Nigeria and Russia.
It expects growth in 2015 of 4.9 percent, slightly lower than its forecast for 5 percent made in August.
Zenith said advertisers in the major European markets of France, Italy and Germany were holding back on spending, while the fall in the oil price had exacerbated the impact of the conflict in Ukraine.
Ad spend in the Russian market was forecast to grow just 1.8 percent this year, following many years of double-digit increases, while in Ukraine conditions had worsened even more.
“The crisis has unsurprisingly had a much greater effect in Ukraine, where violence has disrupted distribution chains and frightened away foreign investors, including big advertisers,” it said. “We expect ad spend in Ukraine to fall 49 percent this year.”
According to media reports, Interpublic Group’s Magna Global also trimmed its forecasts for next year, taking its biggest cut to expectations for Russia.
Reporting by Kate Holton; Editing by David Holmes and Louise Heavens