WPP’s GroupM has raised its forecast for UK adspend this year slightly (to five per cent growth from its original 4.1, a total of £18.9bn) and is forecasting 4.8 per cent for 2018 which should take it through £20bn.
The acid test for all such forecasters is 2019 of course, the year that Brexit is supposed to happen.
In the meantime TV has recovered from a poor start to the year but is still down 2.9, radio is still doing well (up 3.9), national and regional news brands are down again as are magazines but that’s a consistent tale while out of home, which has done well in recent years, is flatlining with no growth. The rush to digital sites seems to have skewered the market with over-supply there and, for some advertisers anyway, a shortage of premium static sites.
What GroupM calls ‘pure play’ internet is up 13 per cent, forecast to drop to below ten per cent in 2018. But slowing growth is inevitable given the size of the medium, which GroupM expects to take 60 per cent of the whole market – about £12bn – in 2018.
GroupM futures director Adam Smith says: “Advertising investment remains stable despite a fragile economy. The focus of marketers remains relentlessly short-term and arguably underweighted relative to long-term brand building in broadcast media. This favours performance-oriented digital media which continue to be the most robust growth story despite concerns over measurement, transparency, brand safety and other issues.”
None of which is especially good for GroupM and its media agency rivals. GroupM UK CEO Nick Theakstone says: “Our forecast shows a stable market in an overall low-growth consumer spending environment. This is encouraging, but we are concerned about pressures on marketers to overweight short-term ROI versus brand building for the long-term. It’s imperative they get the balance right.”
There is, indeed, mounting evidence that what GroupM calls ‘legacy’ media, in seemingly remorseless decline, works better for some brands in some circumstances. But money talks and, so far, there’s no evidence that advertisers are preparing to desert seemingly cheaper internet options.