IPG’s Magna forecasts 7.2% dive in global adspend, offline media taking the biggest hit
IPG Mediabrands’ Magna is the latest to unveil its crystal ball (no plurals please) for 2020 and it’s forecasting a 7.2% drop in global adspend with what it calls linear (offline) media tumbling by 16% with digital inching up one per cent.
The EMEA region will be worst hit (down ten per cent, 14% in southern Europe. The UK is forecast to drop 8.9 per cent with GDP down 6.5 per cent.) The US will be the best performing market (down four per cent) in part due to the forthcoming Presidential election. Global ad revenue will drop $42bn from $582bn in 2019 to $540bn. $301bn of this will be digital.
By linear medium, TV ad revenues will shrink by -12% this year (despite bigger audiences amid coronavirus) Print ad sales will decline by -32% while linear radio advertising revenues will decrease by -15%. Out Of Home, the most dynamic linear media channel pre-Covid will drop by 22%, hammered by transport, and cinema by 40%. Most cinemas are still closed.
There’s some light at the end of the tunnel in 2021: the global economy should recover (real GDP +5.8% according to the IMF) and major sports events (Summer Olympics, UEFA Football Championship in Europe) may fuel a recovery in marketing budgets and advertising spending. Magna predicts global adspend to grow by +6.1% to $573 billion (EMEA: +7.1%, APAC: +8.1%, LATAM: +6.7%, NA: +4.0%). Despite the forecast recovery, the global marketplace will remain $9bn smaller than its pre-Covid level.
All of this depends on there being a gradual recovery from lockdown and today’s news – further virus outbreaks in Beijing (seemingly caused by another of those damned Chinese food markets) and the US (don’t ask) is hardly encouraging.
At the same tine a professor involved in the Oxford University vaccine trial with AstraZeneca reckons a vaccine may be available (in the UK at least) by late September/October.
Who’d be a forecaster? The one certainty seems that linear/traditional media will take the biggest hit, leaving a much-changed map of adland when this is (we hope) all over.
