By Simon Gwynn
The global ad market is back in rude health and will comfortably reverse the decline it experienced in 2020 as a result of the pandemic, according to the latest Dentsu Ad Spend Report.
The latest figures predict the global market will grow 10.4% this year, reaching a total adspend of $634bn (£457bn) – almost double the 5.8% forecast in the last edition of the report in January.
Dentsu has also upgraded its measure of how the market fared last year, from a global decline of 8.8% to a less severe 7.2%. The two sets of figures taken together imply the global market in 2021 will be 2.5% larger than it was in 2019.
The change in outlook has been driven by a big increase in estimated growth in the US, from 3.8% in January to 13.7% today, while Canada’s growth rate has been revised up from 7.2% to 14%, and Australia is up from 5.9% to 12.7%. The change means these three countries overtake the UK and India as this year’s fastest-growing ad markets – although the estimated growth in the UK is also up, from 10.4% in January to 12%.
Across Western Europe, however, there is no overall improvement in Dentsu’s forecast growth this year of 7.5%, meaning it is the only region that will remain noticeably behind 2019’s level of adspend. Western Europe’s unchanged forecast is the result of growth being downgraded in France, Germany, Italy and Spain. Looking ahead to 2022, Dentsu has also downgraded its forecast of growth in the UK that year from 10.5% to 8.5%.
Digital firing on all cylinders
Dentsu’s breakdown by media sector continues to show that digital will account for exactly half of global ad spend this year, though growth in digital is now expected to be 15.6% rather than 10.1%.
The report also upgrades its forecast for most other channels, with the next biggest, linear TV, up from only 1.7% growth this year to a much healthier 7.1%. Print is the only media category that will remain in decline this year, with magazines following a 19.7% decline last year with a further 10.3% drop this year.
Within digital, social media will enjoy the best performance, with its growth forecast revised up from 18.3% to 23%. That is on top of 15.1% growth last year, and 27.4% in 2019.
Dentsu is forecasting further growth for social media ad spend of 17.2% in 2022 – meaning its total global value will have more than doubled over the four years from 2018 to 2022.
Video and digital display – both channels that declined slightly last year by 1.6% and 1.8% respectively – will return this year to a strong growth of 17% and 13.5%.
Peter Huijboom, global chief executive media at Dentsu international, said: “The shift in consumer behaviour experienced during the pandemic has changed the advertising landscape. Trends we saw developing ahead of 2020 have now become mainstay, such as the shift to digital, e-commerce and the need for greater personalisation in media targeting.
“Brands need to be increasingly agile and flexible, continuously making informed decisions regarding media channels based on data and insights. Investment in analytics is key and will help to build a view of how behaviours are evolving in future years.”