Home > Surveys and Research > NARI Surveys - Revised Forecast for Advertising Expenditure for FY 2010—6.2% Year-on-Year Increase (Outline)
Revised Forecast for Advertising Expenditure for FY 2010—6.2% Year-on-Year Increase (Outline) Advertising expenditure in FY2010 to increase by 6.2% year on year, the first increase in three years
Up 3.8% in the first half; expected to rise 8.5% in the second half—Also includes advertising expenditure forecasts for Internet, transit and newspaper flyers and direct mail
The Nikkei Advertising Research Institute (NARI) and the Japan Center for Economic Research (JCER) have amended their forecast for advertising expenditures for fiscal 2010 (April 2010–March 2011).
Compared to the forecast figures announced in January 2010 (down 4.0% year on year), advertising expenditure will increase 6.2% compared to last year, reflecting an upswing in the economy. However, figures are still far below pre-Lehman shock levels, when the downturn in the global economy in autumn 2008 precipitated a substantial drop, and have yet to regain the level of the second half of fiscal 2007, when such expenditure peaked.
This forecast uses the NARI/JCER model developed by the two organizations and is based on total advertising business sales (“total advertising expenditure,” hereafter) reported in the Ministry of Economy, Trade and Industry’s Specific Service Industry Dynamic Statistics.
According to the forecast this time, total advertising expenditure, down 13.0% year on year in fiscal 2009, is expected to increase by 6.2% over the previous year in fiscal 2010. Advertising expenditure had declined below previous-year levels for two consecutive years, in fiscal 2008 and fiscal 2009, so this will be the first increase in three years. Whereas advertising expenditure for the four mass media (newspapers, television, etc.) had dropped by 12.4% in fiscal 2009, it will increase by 4.8% in fiscal 2010.
Newspaper and TV Advertising Expenditure Recovering, but Still Sluggish for Magazines and Radio
By media, advertising expenditure for television, which accounts for the largest share, is expected to rise by 6.9% (vs. -9.3% in fiscal 2009). After the second half of 2009, the rebound in spot advertising has contributed to this increase. Advertising expenditure for newspapers is expected to grow by 1.2% (vs. -16.2%), rebounding weakly from the previous double-digit drop. For magazines, advertising expenditure will decline 2.9% (vs. -27.3%), meaning no recovery yet from the substantial drop in 2009. Radio advertising expenditure will also continue to be sluggish, declining 2.6% (vs. -14.9%).
This report also forecasts advertising expenditure for the non-mass media, in this case Internet, transit and flyers delivered with newspapers and direct mail. In fiscal 2009, advertising expenditure for the Internet grew at the single-digit level, 6.1%, but will again post double-digit growth of 17.3% in fiscal 2010. For transit, advertising expenditure will grow 0.6%, about the same as before (vs. -17.7% in 2009) and will increase by 6.8% (vs. -11.4% in 2009) for newspaper flyers. and direct mail
Clear Recovery Trend in the Second Half
Dividing the forecast into figures for the first and second halves, total advertising expenditure for the first half of fiscal 2009 was down 16.5% compared to the same period the previous year and down 9.6% compared to the previous year’s corresponding period in the second half. For the first half of fiscal 2010, advertising expenditure will increase 3.8% and 8.5% in the second half, clear indication of a recovery trend in the second half. Total advertising expenditure for the four mass media in the first half of fiscal 2010 will increase by 2.5% (vs. -16.3% in the first half of 2009) and by 6.9% in the second half (vs. -8.3% in the second half of 2009).
By media, in the first half advertising expenditure will be down 2.4% for newspapers, down 8.3% for magazines, up 5.3% for television and down 4.5% for radio; thus, except for television, advertising expenditure for the first half will still fall below that for the previous year’s corresponding period. In the second half, the figures will be up 4.4% for newspapers, up 2.4% for magazines, up 8.4% for television and down 0.7% for radio, with only radio coming below last year’s figure for the same period.
Meanwhile, Internet advertising expenditure is expected to grow strongly, at 9.0% in the first half and 24.1% in the second half. Advertising expenditure for transit will drop 2.7% in the first half but post a 3.9% increase in the second half. For newspaper flyers and direct mail, advertising expenditure will rise 4.6% in the first half and continue the growth trend in the second half, with an increase of 8.9%.
