France is the eighth-largest ad market in the world, and the third-largest in Europe. It struggled during the eurozone crisis in the first half of the decade but growth is now picking up, led by internet advertising – particularly video, mobile display and mobile search.

French manufacturing held up in the second half of 2017, with a strong performance by the aerospace industry. Household consumption picked up thanks to spending on textiles and household equipment. Both public and private investment growth held steady. However, exports slowed while imports jumped markedly. The IMF estimates that GDP grew 1.6% in 2017, up from 1.2% in 2016, and forecasts 1.8% growth for 2018. These positive signs herald a healthier environment for the French ad market than it faced in the first half of the decade, when adspend remained essentially stagnant.

We revised our adspend forecasts upwards in September thanks to increased confidence in digital and improvement in the economic environment. We now think that 2017 ended up slightly ahead of our December forecast, with 2.5% growth rather than our forecast 2.0%. But the continued weakness of traditional media has led us to downgrade our longer-term forecasts, despite the continued strength of internet advertising. We now forecast annual growth rates of 2.7% every year to 2020, compared to our previous forecasts of 2.7% growth in 2018, 3.0% in 2019 and 3.2% in 2020.

The football World Cup will boost adspend this year, as will the Euro football championship and Summer Olympics in 2020.

Internet advertising grew faster than expected in 2017, by 13.0% instead of our previous estimate of 10.6%. Search, video and affiliates advertising were all well ahead of expectations, with only traditional display disappointing. We don’t think internet advertising will be able to maintain this pace of growth, however, and forecast 10.9% growth in 2017, 10.1% growth in 2019 and 9.3% growth in 2020. Growth will be led by video (which will grow at an annual average rate of 23.0% a year between 2017 and 2020), mobile display (which will grow at 25.6%) and mobile search (18.3%).

Television will benefit somewhat from new legislation allowing broadcasters to show products for sponsorship. But the migration of budgets to online video has caused us to revise our forecasts for television growth downwards. We now expect the television market to be flat this year, shrink 0.5% next year and shrink 1.0% in 2020. The government is still consulting about plans to allow currently banned categories such as films, retail promotions and literary publishing to advertise on television, and to authorise addressable television advertising. The former could boost television adspend by €150 million to €200 million a year, but faces strong opposition from other media. Addressable television is less controversial but is not expected to launch until 2020-2021 at the earliest.

Radio continues to shrink as advertisers shift budgets to online audio platforms.

Outdoor is growing slowly, thanks to contractors’ investment in digital outdoor displays.

Newspapers and magazines will continue to shrink by 7%-8% a year, while cinema will grow by 3% a year.

The internet overtook television to become the largest advertising medium in France in 2016. By 2020 we expect internet advertising to account for 43.8% of total ad expenditure, compared to television’s 28.2%.




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