Total Media Ad Spending on Recovery Path in Argentina - eMarketer

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Total Media Ad Spending on Recovery Path in Argentina

Expenditures in all paid media will reach $3.78 billion in 2014

October 31, 2014

Adverse economic conditions including sliding exchange rates and rampant inflation—neither of them is acknowledged by government agencies or officials—came into play in 2013 when a precipitous 13.5% drop took total media ad spending in Argentina down to $3.56 billion, eMarketer estimates. To make matters worse, Argentina defaulted in July 2014 after an unfavorable judge ruling in a dispute over sovereign debt between the South American nation and a small group of hedge funds in the US. Since then, the country’s currency has come under renewed pressure as US dollar reserves continue to dip and international financing remains out of reach after Argentina’s credit rating was downgraded to junk soon after its default.

Total Media Ad Spending in Argentina, 2012-2018 (billions and % change)

Amidst deteriorating economic conditions, total media ad spending in Argentina has proved resilient, however. Due at least in part to the deep impact absorbed by the industry last year, eMarketer expects expenditure on paid media to undergo a mild recovery in 2014, rising 6.0% to reach $3.78 billion. Total media ad spending, however, will come to a full recovery only until 2016 when it will reach $4.24 billion.

Indeed, there are early indications that growth will be achieved this year. According to H1 2014 Cámara Argentina de Agencias de Medios (CAAM) estimates, overall ad spending—not including digital media—expanded 34.2% compared with the same period a year earlier and surpassed the 30.7% expansion—digital media included—posted in full-year 2013.

A more telling measure of real growth in the advertising industry in Argentina is the number of inventory units sold. While 2013 registered a meager 1.8% increase in inventory sold from a year earlier—which means most of the growth in ad spending came from inflation—so far this year the metric registered growth rates of 3.9% and 9.9%, respectively, in Q1 and Q2, according to CAAM.

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