According to the latest Advertising Association/WARC Expenditure Report, the UK ad market is now not expected to recover fully until 2022. Our Michelle Morgado comments on the findings.
The latest AA/WARC expenditure report continues to demonstrate the fragility of UK advertising due to the impact of Covid-19, with further revisions being made for 2021 and a clearer picture of the true effect on 2020.
It has made clear the harsh reality of the impact of the ongoing pandemic on the UK ad industry, whereby it suffered its worst ever quarter on record, with a drop in adspend of 33.8% in Q2 2020 compared to the same period in 2019.
The forecast downgrading may not come as a surprise to many, with the Government imposing newly formed localised lockdowns over the winter, the ongoing Brexit negotiations, and ultimately the end of this pandemic being impossible to predict. UK adspend will take some time to bounce back.
Digital marketing continues to remain resilient during this time as consumers shift media consumption online, although not all have benefited. Google recorded its first ever loss, albeit minimal. Within their financial report, it is evident that there are positive signs for growth of YouTube ad revenue. Social media giant Facebook has shrugged off the impact of the pandemic with revenue up 11% YoY ($18.69b) and monthly active users up 12% YoY.
Marketing will be critical to recovery efforts after this crisis. With this in mind, incentives such as the Advertising Association’s tax scheme will go a long way in encouraging advertisers to spend. However, new HFSS restrictions poised for 2022 will only slow down growth, removing £200m from the broadcast market. As such, brands need to remain agile, continue to optimise regularly and need to be in tune with consumer sentiment, spending power, and consumption patterns.”
To read the article in full in Mediatel, click here.
First featured 29/10/2020.