Advertising is healing at a quicker rate than previously thought
- Monday, December 7th, 2020
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The outlook for the global ad market is looking a lot healthier thanks to a faster-than-expected recovery in ad spend following the damage caused by the coronavirus pandemic during Q2 2020. Zenith’s latest prediction suggests the global ad market will shirk by 7.5 per cent to $587bn across this year, compared to the 9.1 per cent decline it forecasted in July.
Looking ahead, global ad spend is expected to grow 5.6 per cent to $620bn in 2021, thanks to its comparison with 2020 and the delayed Summer Olympics and UEFA Euro football tournament. Despite this, it’s still down on the $634bn spent in 2019. In 2022, ad spend is predicted to grow a further 5.2 per cent to reach $652bn and exceed 2019’s spend, however.
The Asia Pacific and Central & Eastern Europe regions will lead the recovery in spend. In fact, both are set to bounce back to their 2019 levels in 2021. Asia Pacific will benefit from how successfully many of its markets managed to contain and limit the health and economic damage of COVID-19, while Central & Eastern Europe will benefit from having a less developed ad market than other regions and thus having a faster underlying growth rate.
In 2020, North America has seen spend shrink by just 5.3 per cent – compared to 12.3 per cent in Western Europe, 13.8 per cent in Latin America, and 20 per cent in the Middle East & North Africa – thanks to heavy political spending around the US presidential election.
Compared to the overall ad market, digital ad spend is set to grow by 1.4 per cent this year, increasing its share of total ad spend to 52 per cent in the process, up from the 48 per cent share it had in 2019. Within this, search is spend up eight per cent and social media 14 per cent.
Digital advertising is on course to account for 58 per cent of global ad spend by 2023.
“The global ad market has been recovering from its Q2 nadir throughout the rest of this year,” said Jonathan Barnard, Zenith’s Head of Forecasting. “The prospect of multiple effective vaccines gives us confidence that ad spend growth will continue in 2021 and beyond, returning the market to 2019 levels in 2022.”