According to Zenith’s first adspend forecasts since the start of lockdown, digital advertising is to claim the majority share of total global advertising expenditure for the first time this year at 51%, rising to 55% in 2022.
However, global adspend is expected to shrink by -9.1% in 2020 as a result of the Covid-19 pandemic. In comparison, adspend shrank by -9.5% during the 2009 recession.
A 5.8% recovery in spend is expected next year, however, boosted by the rescheduled Olympics and UEFA Euro 2020 football championship.
According to Zenith, the main trends now driving spend in advertising are ecommerce, data-driven personalisation and digital acceleration, with these trends expected to continue indefinitely.
Meanwhile, following a spike in the early weeks of lockdown, consumption of digital media is not expected to return to pre-crisis levels any time soon.
As a result, there has been a more “rapid shift” in media budgets from “traditional” to digital media than originally expected. In December, Zenith had forecast a 49.5% market share for digital advertising in 2020.
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“The coronavirus forced brands to embrace digital advertising even faster than expected and made digital transformation of businesses more urgent than ever,” said Jonathan Barnard, Zenith’s head of forecasting.
“This year will be the first in which digital advertising will attract more than half of total global adspend, a milestone we previously expected in 2021.”
As a whole, digital adspend is only expected to endure a -2% decline across 2020.
Zenith does not expect any of this share to return to “traditional media” as the crisis eases – digital advertising’s market share is forecast to reach 54.6% in 2022.
Meanwhile, of the “traditional” media channels, television and radio suffered the least. By the end of the year, TV is expected to record an -11% decline in spend globally, while radio is forecast to be down by -12%. Some recovery is expected in 2021 – by 2% and 1%, respectively.
Print advertising spend in newspapers is expected to shrink by -21% this year, while spend in magazines is to decline by -20%. No recovery is forecast in print, with Zenith predicting a continued decline in spend through 2021.
With lockdown having kept consumers indoors, out of home is expected to shrink by -25% in 2020, but recover by 16% in 2021. Cinema is set to see spend plummet -51% this year, before recovering by 65% in 2021. Neither is expected to return to their 2019 peaks by 2022.
Overall, Latin America, Western Europe and MENA are the worst affected regions, with advertising expenditure set to shrink by -13%, -15% and -20% this year, respectively.
In comparison, the US ad market is forecast to decline by just -7%, aided by political advertising in the run up to November’s Presidential elections. Asia Pacific is forecast to shrink by -8%, as is Central and Eastern Europe.
