Compared to the same period last year, advertising expenditure in the GCC increased 20%. According to the Pan Arab Research Centre (PARC), advertising expenditure in the region, which includes Pan Arab media which is mainly satellite TV channels, reached $5.05 billion from January to June compared to $4.22 billion in 2009.
The increase exceeded the expectations of the impact of the global financial and economical crisis on advertising activity in the region which caused the sector to grow by a relatively modest 9% in 2009, reaching $9.2 billion compared to $8.9 billion in 2008.
Khamis Al-Muqla, Chairman of Gulf Marcom Group headquartered in the Kingdom of Bahrain and Worldwide Board Member of the International Advertising Association, commented that these figures are a good indicator that the advertising activities in GCC are recovering and steadily returning to the previous level of growth seen over the last ten years. Should the rate continue, Al Muqla said, advertising expenditure will exceed the $10 billion barrier by end of 2010 for the first time, a milestone which was expected to be reached last year had it not been for the economic crisis.
Mr. Al Muqla noted out that the PARC report indicated that the Pan-Arab media share of the advertising expenditure rose to $2.86 billion representing an increase of 34% compared to $2.14 billion in 2009. According to these figures, Pan Arab media had the greatest share of the increase in GCC advertising expenditure with 57% of the total GCC spending.
By country, Bahrain's advertising expenditure grew by 40%, the highest rate amongst all GCC countries, followed by Oman (12%), Qatar (11%), Saudi Arabia (9%), and Kuwait (8%). The UAE was the country to record a decrease (4%).
Despite the drop, the UAE maintained its leadership position in terms of market share in GCC adspend at 31%, followed by Saudi Arabia (27%), Kuwait (21.7%), Qatar (10.2%), Oman (6%), and Bahrain (3%). These percentages do not include Pan Arab expenditure which is directed to key markets in the GCC, particularly Saudi Arabia.
Other Arab markets also registered impressive growth with Egypt topping non-GCC countries at 36% followed by Lebanon (19%) and Jordan (9%).
Furthermore, Mr. Al Muqla added that TV advertising - including Pan Arab media - grew by 39% to reach $3.48 and continues to lead the total GCC advertising expenditure with a market share of 57%. Print media was a distant second at 37%, with newspapers comprising 31% to reach $1.89 billion, an increase of 6%, followed by magazines with 6% market share and $368 million in total spend. Outdoor advertising's market share shrunk to 4% having decreased by 6% to $244M. The list is rounded out by radio (1%), which increased by 10% to reach $73M, while cinema barely reached $10M, the same figure as 2009.
Amongst local markets, print media dominated local media ad spend with a share ranging between 70% - 80%.
Mr. Al-Muqla added that the biggest advertising sectors during this period were communications and public utilities which recorded a 39% increase to grab 15% of the market share. It was followed by toiletries hygiene/house care products (15%), up 26%, government organizations (14%), up 27%, and food, beverages, and tobacco (11%), up 37%.