09 February 2010 | Author: J. Cave SEO Consultant

Advertising sector expected to return to growth

The advertising sector is expected to return to growth in Q3, spurred by increasing revenues from both cinema and internet advertising.

Alongside most industries, the advertising industry has been in a recession. However, industry experts are expecting it to come out of recession by the end of the third quarter in 2010, according to newly released figures from the Advertising Association and research company Warc.

According to the figures, advertising spend is expected to return to growth with spending expected to rise by around 2.8 per cent.

The advertising industry has been in recession since Q2 in 2008 and - if it returns to growth in Q3 of this year - it will have endured nine negative quarters.

Although the industry fell into a decline, two sectors saw growth during Q3 of last year, internet advertising and cinema advertising.

Internet advertising rose by 4.2 per cent year on year while spending on cinema advertising increased by a massive 10.2 per cent year on year.

Even though cinema spend rose, it wasn't all good news for the entertainment industries - TV advertising revenue fell by 12 per cent during the quarter, with radio following close behind.

However the sector to get hurt the most was press, with advertising spend falling by 21 per cent year on year. It is thought that the decline of the press is directly related to the growth of the internet, with more and more advertisers taking advantage of the expanding online advertising market.

Rufus Olins, chief executive of Warc, said, "There is clear evidence that the UK 's worst media recession in three decades was bottoming out by autumn 2009, and prospects for a return to growth in ad spend later this year are now good. However, as recent UK economic data has shown, the recovery is still fragile."