ZenithOptimedia, the media-buying division of Publicis, is to downgrade its advertising spending forecasts in North America and Western Europe for 2008 because of fears of a recession.

In its first forecasts for the advertising market in 2008, the media buyer will say today that previous growth forecasts of 4.4 per cent for this year have been reduced to 3.8 per cent. However, it has upgraded its forecasts for the rest of the world, from 10.9 per cent to 11.1 per cent.

“We have downgraded the combined growth forecasts for North America and Western Europe, as the credit crunch drains consumer and business confidence. However, growth continues to strengthen elsewhere,” a ZenithOptimedia spokesman said.

The net result is a downgrade of global growth from 6.7 per cent to 6.5 per cent. This is above the 5 per cent growth rate that the global advertising market has averaged for the past ten years, thanks to a growing advertising market in Asia-Pacific, Central and Eastern Europe, Latin America and the Middle East.

ZenithOptimedia expects developing markets to contribute to 63 per cent of advertising expenditure growth until 2010 and increase their share of the global market from 27 per cent to 33 per cent. China and Russia follow closely behind the United States as the biggest contributors to growth over the next three years, even though China’s advertising market is only 8 per cent of the size of the American advertising market; Russia’s is 5 per cent.

The group has increased its forecasts for internet advertising. By 2010, internet advertising expenditure will reach $67 billion - up from $61 billion in its last forecast - and will account for 12.3 per cent of the market, up from 11.5 per cent.

Online video and local search are generating substantial new revenues and ZenithOptimedia expects behav-ioural targeting on social networking websites to provide new opportunities to advertisers. Some of the internet’s growth will come at the expense of newspaper advertising, which is expected to grow 4 per cent over the forecast period. After adjusting for inflation, this equates to a 5 per cent decline in expenditure.

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