IPG’s Magna joins boom times are coming chorus

IPG’s Magna has revised up its global ad forecasts: now its 14% up this year and seven next, adding $78bn this year. Most of this, of course, will find its way into the bulging pockets of Facebook and Google, but you can’t have everything.

Driving growth are sectors like automotive, travel and entertainment recovering (in different degrees) from lockdown and major sporting events. Global GDP os forecast to rise 6.4% this year.

Specifically:

*Digital ad formats capture most of the growth with ad sales up +20% to $419bn, 64% of total ad sales.

*Linear ad sales will be slower to recover but will stabilize full-year (+3% to $238bn).

*All 70 ad markets monitored will expand again this year with China (+16%) and the UK (+17%) among the largest increases.

*The US market will grow by $34bn (+15%, strongest growth rate in 40 years) to reach $259 billion, with digital ad sales up +20% and non-political linear ad sales up +4%.

*Linear ad sales still represent the bulk of ad revenues for traditional media owners and their continued stagnation will trigger a wave of consolidation in the media industry, aimed at competing with digital media players.

Magna says: “As economic recovery is stronger and faster than anticipated in several of the world’s largest ad markets (US, UK and China, in particular) and consumption accelerates, brands need to reconnect with consumers. At the same time, the acceleration in ecommerce and digital marketing adoption that started during COVID, continues full speed into 2021, fuelling digital advertising spending from consumer brands as well as small and DTC businesses.

“This unique combination of cyclical, organic and structural drivers will lead to the strongest advertising annual growth ever monitored by MAGNA: +14% globally (+15% in the US).”

It could, of course, all go pear-shaped again. All the forecasts from the big agency groups are showing huge differences from one quarter to the next. The UK’s much hoped-for ‘freedom day’ with all pandemic restrictions lifted is about to be postponed for a month, leaving some to doubt if things ever will get back to what we used to regard as normal.

Not that Facebook and Google will be too bothered.

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About Stephen Foster

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Stephen is a former editor of Marketing Week and London Evening Standard advertising columnist. He wrote City Republic for Brand Republic and is a partner in communications consultancy The Editorial Partnership.