ALERT: Global Media Awards entry submission deadline in only 1 week

6 reasons media advertising looks promising in 2022

By Mark Challinor

INMA

London, United Kingdom

Connect      

I have been reading some interesting reports on the rise of advertising spend in 2021 (with overlaying forecasts for 2022), and I quickly saw why there are reasons to be cheerful looking ahead. 

1. Strong overall advertising growth

Combining the reports, I can see for example, that according to data from Magna’s Global Advertising Forecast, the global economy has recovered in line with expectations and in most markets, so has marketing activity and advertising spend.

The Magna Global Advertising Forecast shows a strong 2021 recovery and points to the same in 2022.
The Magna Global Advertising Forecast shows a strong 2021 recovery and points to the same in 2022.

Magna says the recovery in 2021 has been really strong overall, especially where COVID vaccinations were “fast and comprehensive” and allowed full business re-opening early in 2021 (US +6.0%, UK +6.8%, France +6.3%).
 
The Magna report says: “Some other large markets displayed tepid economic recovery by comparison, due to underwhelming vaccination and lingering COVID restrictions and/or a manufacturing sector crippled by supply-chain issues,” citing growth in Japan +2.4% and Germany +3.1%. But, a positive/upturn nevertheless.  

2. APAC forecasts look promising 

The Asia Pacific (APAC) advertising market, centred around China and Japan (which combine to represent 70% of total regional ad spend) has seen a slight decrease over the past year — mainly because China’s growth in 2021 has been lower than most APAC markets. This is due to a combination of factors: China was one of a small number of markets that still grew spending in 2020 (so comparisons year-on year are perhaps skewed somewhat). In addition, they had a government crackdown on digital media owners, which has hampered overall advertising revenue growth in digital formats. 

However, Magna says that in 2022, the strongest growth in APAC will come from India (+15%), the Philippines (+14%), China (+13%), and Malaysia (+12%). The weakest growth, on the other hand, will emerge in Thailand (+3%), Vietnam (+6%), and Hong Kong (+8%), where they are still struggling with their worst COVID outbreaks of the pandemic. Nevertheless, again, still a positive/upturn? 

Global advertising spend is growing faster than expected in the earlier days of the COVID pandemic.
Global advertising spend is growing faster than expected in the earlier days of the COVID pandemic.

Overall, global advertising spend and revenue are growing faster than previously thought, according to forecasts of some of the world’s biggest media-buying networks.

3. Scaling of digital is encouraging 

In addition to Magna, others have published reports finding that economic recovery, increasing demand across categories, and the scaling of digitisation are all contributing to the pandemic recovery.
 
GroupM says: “The pace which the growth is occurring is so surprising at so many levels. Every time we published a forecast this year (in 2021), we have been worried that we were too aggressive, but it turns out we were conservative.”

4. UK leading the way

They describe the ad revenue growth here in the UK, for example, as “the most surprising” given our economic hardship over the pandemic period (thus far). GroupM analysis found the UK had the highest ad revenue growth total among major markets at 35.7% for 2021, far above September forecast of 30%. The UK market is expected to reach £35.8bn in 2022 and remain the largest market in Europe (fourth largest in the world) as a result of continued GDP growth — new COVID variants aside, of course, and any further impact they may cause. (We watch with caution the rise of the Omnicron variant for instance and what still-unknown havoc that might cause yet). 

GroupM analysis found the UK had the highest ad revenue growth among major markets.
GroupM analysis found the UK had the highest ad revenue growth among major markets.

The anticipated good news was echoed by Zenith and Magna in their forecasts. 

Zenith said advertising across digital channels will exceed 60% of global advertising spend for the first time in 2022, which would equate to 61.5% of total expenditure:
  
“As consumers rely ever more on digital technology to connect and entertain them, and to inspire and fulfil their purchases, advertising is playing a greater role in driving sales and brand growth. Over the next three years, we expect the ad market to achieve its highest rate of sustained growth since 2000”.

5. More streaming and commerce ahead 

Meanwhile, Magna’s summation of the market can be summarised as follows, a summation that media should take note of. In essence, they say the experience of COVID-19 and a “home-centric” lifestyle has changed consumer behaviour towards more streaming, more eCommerce, and more integration of digital platforms into day-to-day lives, which in turn is driving digital advertising spending. Note well, for 2022? 

6. Creating better experiences 

In my opinion, the above points to a combination of a number of specific trends that will come to the fore in 2022 and which might be important for us all in media circles. Watch out for my next newsletter later this month where I will detail my top 10 digital advertising trends for media in 2022. They include (and relevant to the above), mobile commerce, live streaming, voice, video, and first-party data. We must, more than ever, create better experiences and generate new revenue streams. The technologies and enablers are there for us to exploit. 

News media companies continue to create better advertising experiences for advertisers and audiences.
News media companies continue to create better advertising experiences for advertisers and audiences.

This year, I will take a deeper dive into all that via this channel and hopefully equip you with the best advice on how to utilise all that’s around you to help you secure your company’s future revenues. Sign up to my fortnightly newsletter now here.

About Mark Challinor

By continuing to browse or by clicking “ACCEPT,” you agree to the storing of cookies on your device to enhance your site experience. To learn more about how we use cookies, please see our privacy policy.
x

I ACCEPT