November 15, 2005 - ADVERTISERS in inflight media are set to break the $1-billion-a-year spending barrier, new research suggests.

Carried out by London-based seatback magazine specialist Ink Publishing, the research predicts that global inflight advertising revenues will grow from $685 million in 2004 to $832 million this year and more than $1,010 million next year.

The figures are based on the advertising sales in Ink’s own portfolio of inflight titles, along with research by the Air Transport Intelligence online new service and market-by-market data from the World Advertising Research Centre.

Advertising in inflight magazines, IFE programming and airline Websites, product sampling, and the use of “ambient” advertising such as ticket wallets and painting entire aircraft are among the measures advertisers are using to reach upmarket, time-poor consumers.

“Strong growth in worldwide ad spend, combined with the development of niche markets by airlines and rapidly growing passenger numbers across the board, are having a positive effect on the inflight advertising market,” says Ink chief executive Jeffrey O’Rourke.

The researchers found a geographical shift in the amount of money being spent on advertising. North America maintains its position as the

biggest market, though its share of global spend is gradually being eroded and is expected to fall from 41.8 per cent in 2004 to 35.4 per cent next year.

This year Asia-Pacific will replace Europe as the second biggest market. In 2004 Europe represented 25 per cent of the market, with Asia-Pacific contributing 24.5 per cent. By the end of next year Asia-Pacific will account for 27.6 per cent, leaving Europe with 26.0 per cent.

In terms of dollars spent next year, the market will continue to be led by North America with $358.8 million, with Asia-Pacific spending $280.3 million and Europe dropping to third place on $263.5 million. The African market will expand to $20.8 million, Central and South America to $40.0 million, and the Middle East to $51.4 million.

Asia-Pacific is the beneficiary of rapid growth in both passenger numbers and advertising spend, according to O’Rourke. At the same time, point-to-point destinations served primarily by low-cost airlines are opening up new local advertising markets around the world and making inflight media much more effective for regional advertisers.

“If an airline has a regionally focused route structure or is the only carrier flying into a particularly market, local advertisers can tap into captive inflight audiences that have typically been targeted more by national and international advertisers,” he says. Advertisers are increasingly able to aim their messages at specific audiences and destinations.”

He believes the rise of low-cost operations is boosting the effectiveness of inflight media. “The low-cost model is all about using aircraft more by reducing

turnround times and increasing the amount of time spent in the air. Magazine advertisers therefore reach more passengers per seat and per copy.”