Driven by recovery in Asia and Eastern Europe, expenditure on luxury advertising will rise by 3.0% in 2016, up from 1.9% in 2015.
According to Zenith’s new Luxury Advertising Expenditure Forecasts, luxury advertisers will spend a total of US$10.9bn across the top 18 markets in 2016, up from US$10.6bn in 2015.
Between 2015 and 2017, luxury advertising is estimated to grow by US$705m. 82% of this growth will come from the USA (US$347m) and China (US$228m). The USA and China are the largest and second-largest luxury ad markets respectively. Germany is third, followed by France and the UK.
Zenith forecasts Asia to return to 2.9% growth in 2016, while the decline in Eastern Europe slows to 2.8%. North America will stay strong, with 3.9% growth, but Western Europe will slip back to 1.7%.
Digital advertising is by far the biggest contributor to the growth in luxury advertising, growing consistently at double-digit rates. By 2017, print will account for 28.6% of total luxury adspend, down from 31.9% in 2015. TV’s market-share will also decline over the same period, from 32.7% in 2015 to 30.7% in 2017. Digital’s market share will increase from 26.3% in 2015 to 32.1% in 2017, when it will overtake TV and print to become the single largest medium for luxury advertising.
Despite its decline in market-share, print remains particularly important to luxury advertisers, specifically those in the fashion & accessories and watches & jewellery sub-categories. Print titles – especially glossy magazines – provide high-quality, immersive yet relaxed reading experiences, a particularly suitable environment for luxury advertisers wishing to showcase their brand values.