After a 6% decline in 2009, Canadian ad spending is expected to return to positive growth this year according to a new report from New York-based research firm eMarketer.
The report, “Canadian Advertising and the Online Consumer,” predicts that the overall Canadian advertising market will grow by a modest 3.3% to $11.6 billion this year, largely fueled by a 16% increase in online ad spending.
The report’s author, eMarketer analyst Mike Froggatt, said that the Canadian ad market didn’t contract as severely as its U.S. counterpart, and will therefore rebound quicker.
Canadian marketers are expected to invest approximately $2.1 billion in online advertising this year, led by search ($877 million) and display advertising ($698 million), according to eMarketer.
“Search really has the ROI,” said Froggatt. “People can really measure how many clicks you’re getting, the type of usage and users. Search engines have got this down to a science, where they are just pummeling marketers with data.”
Online spending will account for 18.3% of the total Canadian ad spend this year, up from 13.5% in 2008. It is expected to account for more than a quarter (27%) of Canadian advertising expenditures by 2014.
But while online captures a higher share of the total Canadian ad spend than it does in the U.S. (where its share of the total ad spend in 2010 is 15%), eMarketer data indicates that Canadian marketers are spending only about $75 per Internet user, compared with $113 per Internet user in the U.S.
“There’s still room for Canada to catch up to larger markets like the U.S. and the United Kingdom,” said Froggatt.
eMarketer is also calling for online spending in Canada to grow by 19.8% in 2012, as brands flock to Internet coverage of the London Olympics.
