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DAVOS - Advertising's most influential players predicted a strong market in 2007 at the World Economic Forum today, adding weight to already high levels of confidence at the meeting of business leaders.
News Corp chief executive Rupert Murdoch told Reuters he was "bullish" for the market's prospects in 2007. News Corp's assets range from "old media" outlets like Fox and the New York Post to the popular social network MySpace and its wired, young, online audience.
WPP chief executive Martin Sorrell said his advertising and marketing company's 2006 revenues will be "better than expectations" and 2007 should be even stronger. As the world's second-largest advertising and marketing company, WPP has been moving into video game advertising and has invested in Spotrunner, which allows companies to create and place their own TV ads in mere minutes.
Although 2007 lacks any of the giant events like the Olympics or US elections that traditionally drive global ad spending, Sorrell said 2007 would benefit from the run-up to the Beijing games and the ever-earlier start to the US presidential race.
"(For) 2007... we're budgeting revenues for the group up around 4 per cent, 4-1/2 per cent, which is against 3 per cent, 3-1/2 per cent last year, when we've done -- well, I can't say what we've done, but we've done well," Sorrell said. "I'll say we'll do better than expectations."
Analysts on average expect the world's second-largest advertising and marketing company to post 2006 revenues of 5.88 billion pounds ($16.57 billion) and 2007 revenues of 6.15 billion pounds ($17.33 billion), according to Reuters Estimates.
Murdoch said he expected worldwide growth in the advertising market to be better in 2007 than 2006.
The media veteran also highlighted new markets. "The emerging markets are the hotspots," he said.
The global No. 4 advertising agency, France's Publicis, was also upbeat and predicted faster overall growth in advertising spending, despite a slight slowdown in the key US market.
A revival in Germany, following sluggish 10 years, should be a highlight of 2007, he said.
"We will have in 2007 something in the region of 4.5 to 5 per cent, with Europe taking over the US in terms of the rate of growth," Maurice Levy said in an interview.
"The rate of growth in the US will still be very good but not as strong as it has been in the last years."
One feature of the market in 2007 would be increased migration of spending from traditional media to the internet, the industry executives said.
Google Chief Executive Eric Schmidt and founders Sergey Brin and Larry Page were prominent at Davos and the Web search company sponsored the week's biggest party.
Sorrell noted that Google had a market capitalisation nearly 10 times that of the top four advertising companies -- Omnicom, WPP, Interpublic and Publicis -- combined.
- REUTERS
