UPDATE: Publicis CEO Sees Ad Indus Back At Full Speed In 2011

25th Jun 2010 17:14

By Ruth Bender Of DOW JONES NEWSWIRES CANNES, France (Dow Jones)--The advertising market continues to improve faster than expected and should return at least to 2008 levels next year if current trends continue, Publicis Groupe SA's (PUB.FR) chief executive said Friday. Global advertising spending will probably rise by more than the 2.2% Publicis's unit ZenithOptimedia currently forecasts, CEO Maurice Levy told Dow Jones Newswires at the Cannes Advertising Festival. "I have the impression there will be a reevaluation of global ad spend estimates...In absolute value, the global ad market will be above 2008 levels in 2011." Indeed, other market trackers have raised their growth forecasts for the ad market over the past month. On Thursday, WPP PLC's (WPP.LN) GroupM said global advertising spending will rise 3.5% in 2010 to $451 billion, compared to the 1% rise it predicted six months ago. However, Levy's prediction that 2011 will be the year the industry returns to full speed and maybe even top growth seen in 2008, is slightly more upbeat than competitors. The chief executive of WPP-owned Ogilvy & Mather, Miles Young, Thursday said it will take two more years for the industry to return to pre-crisis growth levels. Levy said he expects all markets to accelerate their improvement throughout the year, even Europe, which is still lagging the recovery. Clients are committed to investing and thinking in the long-term," he said. April, May and June business trends were very encouraging and Publicis will post higher organic revenue growth in the second quarter than in the first quarter, Levy said. After posting a 3.1% rise in first-quarter organic revenue, a key industry measure that strips out currency effects, acquisitions and disposals, Levy told Dow Jones Newswires last month that the group will post 3% organic revenue growth this year if the current improvement in advertising markets continues. Publicis has, however, observed a small slowdown in business in Southern European countries such as Greece, Portugal and Spain due notably to fears about public spending cuts. "This is not significant at a group level though," he said. Publicis still wants to make acquisitions in digital and emerging markets but isn't interested in buying U.S.-based advertising firm Interpublic Group Of Cos. (IPG), Levy said. For years the market has speculated that Publicis will buy Interpublic. Martin Sorrell, CEO of rival WPP PLC (WPP.LN), has repeatedly said Publicis will end up merging with the New-York based group, which Levy has denied. "Mr. Sorrell is very interested in others," Levy said. "For the past five years he has said Havas SA (HAV.FR) will buy Aegis Group PLC (AGS.LN) and Publicis will buy Interpublic. The disc is scratched." Levy said the group would be willing to make a bigger acquisition, if it found a target. -By Ruth Bender, Dow Jones Newswires; +33 1 40 17 17 54; [email protected] (END) Dow Jones Newswires June 25, 2010 12:14 ET (16:14 GMT)