Publicis CEO sees ‘09 World ad spend down 3%


The global ad market will fall more than 3% in 2009, Maurice Levy, CEO of Publicis Groupe SA said in an interview published Tuesday on (Paris-based business magazine “Capital”). “In February, I expected (the ad market) to fall 3% worldwide, it is now clear that the fall will be even greater,” Levy says. “The recovery won’t come before mid 2010, probably in the third quarter.”

The market will continue to deteriorate in the first half, before improving in September and October, although the market will contract in every month of the year, Levy says.

He also mentioned the company is well-placed to meet its objective of generating 50% of its revenue from digital operations and emerging markets in 2010.

“This year, worldwide spending on advertising on the Internet should grow between 8% and 9%,” Levy added.

More from the interview: Is it still necessary to hope for an improvement with the second half-year?
Levy: 2009 will be extremely difficult. The activity will continue to worsen throughout first half of the year…And the recovery will not intervene before Q3 2009, but probably with the third quarter of 2010. Is the current crisis even more violent for the advertising market than that lived in 2001-2003?
Levy: The crisis is more brutal, because it touches the whole of the economy and not a number of sectors limited as in 2001. Especially the advertisers have their  eyes riveted on their level of liquidity and are reducing or deferring all their  investments. Publicity is obviously one of the first [to be cut]. Another great change compared to 2001: the opinion is this crisis much more violent. However France already knew more difficult moments, but the situation is worsened by the colossal losses of the banks and the French cannot consume because the credit market does not function. This is reinforced by the anger of the population towards the financial system. For the record, the bankers, chairmen are responsible for the crisis and continue to grant generous no-claims bonus or stock-options. There is a divorce between the economic opinion and persons in charge. Which media will resist the crisis best?
Levy: Internet will continue to progress because it offers a major advantage on the other media: its reactivity. Thanks to the Net, we can measure the impact of the campaigns in quasi real-time, which enables us to adapt them quickly. This year, the world growth of the publicity expenses on Internet should reach 8 to 9%. On the other hand, in fact the magazines and the daily newspapers will suffer more. The magazines are indeed regarded as media making it possible to sit its image, to reinforce its mark. However today the advertisers are seeking the media which make their products sell, those which offer a fast return on investment.