The first quarter of the year showed signs of stability as the ad spend in the region posted 21 percent growth, and though the growth was not uniform across markets, the heavy fluctuation observed in 2009 subsided to a variability uneven growth. Advertisers continued with their faith on spending on Pan Arab Media that reaches multi markets in the region with a 31 percent growth.
Egypt emerged as top spending market in the region overtaking UAE as Ad Spending surged by 45 percent in the market. UAE put brakes on the declining ad spend in the region and posted a contained decline of 5 percent over the last quarter. All other markets in the region saw a synchronized gain in ad spending over the previous quarter and are KSA (+4%), Kuwait (+21%), Qatar(+10%), Bahrain(+43%), Oman(+1%),Lebanon(+24%) and Jordan(+19%).
Amongst major media types, Television continued following the upward trajectory with a 40 percent growth. Newspaper gained 7 percent spending over the past quarter; however magazines were hit as it declined by 5 percent. With the exception of real estate and Jewelry sector all other sectors are in green reporting healthy ad spending growth. Government and Organizational advertising headed the ranking with an outlay of US $ 440 million equating it to 16 percent of the total market share of US$2.7 billion for the first quarter 2010.
Communication and Public Utilities with a 38% jump in ad spend closely follows Government Advertising spend to occupy the second rank. Toiletries and Household sector occupies third rank and 13% market share. Food Sector holds promising growth with a 45% rise in ad spend. Real Estate continued its downslide and plunged ad spend by 26 percent. However Financial Services reversed its downside movement by gaining 21 percent ad spend compared to previous quarter.
The top 3 spenders in the region for Q1 2010 are Waqfa Masriya, STC and Zain in descending order. After a slow start the internet usage has grown manifolds since Y2000 and the key markets in the region according to TGI survey witnessed a double-digit growth in 2009.Coupled with the increased usage of internet and the need for greater interaction, low cost social media is in focus by marketers. It may even lead to a very high growth in online advertising but in the near future will not make dent in the traditional media.
The region has posted a stable growth even after experiencing some turbulence unlike significant downfall in ad spending that occurred in European and American markets. The ad spend per capita in the region is much lower than other western blocs. The massive infrastructure built in the recent years will make room for service industry to grow.
The implementation of proposed GCC rail system will also usher in bigger growth. Oil and Tourism, two key components of economy in the region, are going strong. However the short term ad spend growth may still face fluctuations with first half of Y2010 likely to face a stalled growth but second half must witness a healthy double digit growth. The ad spend is calculated on the media rate cards and does not account for incentives and discounts that advertisers may avail from media owners.