Automotive advertising expenditure forecasts launched by Zenith has predicted that the Ad expenditure by auto brands will grow by 0.8% through 2019, a fall from 1.5% in the previous year.
While the global automotive advertising looks depressing, India and China took exceptions to the declining trend. With an average of 12.8% a year till 2020, India is the fastest growing market when it comes to auto ad spends.
On the other hand China too, auto ad spend has clocked a healthy growth of 47% between the period 2012 to 2018.In the same period, auto ad spends declined by 12% in the United States, the world’s largest auto market. The US accounted for $18 billion in auto ad spends in 2018.
It was almost thrice as much as the ad spend of China, at $6.3 billion for the same year.Globally, auto ad spend is expected to pick up only in 2020 and grow by 2% thanks to the Olympic games in Tokyo and UEFA Euro 2020 football championship.
The reasons cited for the decline is the industry anticipating a tough year due to worsening trade relations between the US and China and the possible imposition of car import tariffs in the US.
TV, the dominant medium with 21%:
Zenith also anticipated that television, while still being the dominant media for auto ad spend, would see its share drop from 54.9% in 2018 to 53.1% in 2020.
Auto brands have been lagging other categories in shifting to digital.
It accounted for a mere 20.9% of category ad spend in 2018 compared to the global average compared to the global average of 40.6%. Zenith believes the auto industry is likely to increase its spend on digital to 24.4% by 2020.
Zenith’s head of forecasting and director of global intelligence Jonathan Barnard said, “This new research has revealed how differently auto advertising is behaving to the ad market as a whole, as brands tackle unique challenges to their traditional communication strategies.”
Zenith estimated total auto ad spend to be $35.5 billion across the 14 key markets it studied including Australia, Brazil, Canada, China, France, Germany, India, Italy, Russia, South Korea, Spain, Switzerland, the UK, and the USA. These countries account for 74% of global car sales by volume and 76% of global ad spend.