2008 to be great for advertising industry say WPP

WPP, the world’s second-largest agency, has forecasted today that next year will be even better than 2007 for the advertising industry. Chief Executive, Sir Martin Sorrell, said the impact of the Beijing Olympics, US Presidential election and, to a lesser degree, the Euro 2008 football championships, would give a massive boost to an industry that is still growing strongly.

Mr Sorrell added that the major issue is the conclusion of the US election. He continued that a more important concern should be the affect that any new US administration will have on 2009, when they have seen the government’s books and will be tempted to dispense any politically unpleasant medicine to the electorate early in the 8-year political cycle.

The Chief Executive said that while the fast-growing areas of the world’s economy, like India and China, are now less reliable on the US, it’s a fact that when there are problems in the US, it penetrates to the rest of the world.

He added that in the shorter term, the impact of th sub-prime mortgage crisis and credit squeeze has had little effect on spending levels across the board. Any real impact is unlikely to be felt until WPP completes its internal budget predictions and knows its clients plans early next year. He highlighted that of WPP’s top 50 clients, only 3 are in the financial services sector.

It is estimated that next year’s events such as the Olympics could boost advertising and marketing spending by $2 billion (£980 million), the US Presidential election by between $1.5 billion and $2 billion and Euro 2008 by less than $1 billion.

Third-quarter revenues at WPP grew by 4.9%, slightly under analysts’ estimates of 5.5%. Taking away the impact of the weak dollar, the figure was 8.1%.

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