GroupM's Global Mid-Level TYNY report focuses on significantly raising global advertising forecasts in 2021.
Midway through 2021, it has become apparent that the market is growing much faster than expected and from a larger base than we previously believed. While many of these growth factors were in place before last year, the pandemic has proven to be an accelerant.
GroupM has launched the This Year Next Year (TYNY) report which is a global mid-year forecast for 2021. According to the report, some factors causing higher than expected growth include faster than expected expansions of app ecosystems, rapid small business formation activities and the growing role of cross-border media marketplaces, especially involving manufacturers based in China. The key highlights of the report are as below.
The industry overall forecast:
2021 growth: 19 per cent (excluding U.S. political advertising), a significant upward revision from our December forecast and 15 per cent higher ad revenue than 2019.
Global advertising, including U.S. political, is expected to exceed $1 trillion in 2026, up from $641 billion in 2020 and $522 billion in 2016.
Concentration within the industry has increased over this time: in 2020, the top 25 media companies represented 67 per cent of total advertising revenue. That same group of companies accounted for 42 per cent in 2016.
Several markets should see better than 20 per cent growth, including the U.K., Brazil, China and India.
Many others will rise by the high teens, including Canada, Australia and the U.S.
Here are four areas that were considered in detail as we reach the halfway point of 2021:
Digital advertising: We now forecast 26 per cent growth for all forms of pure-play digital media versus 15 per cent at the time of our December update.
Expectations for other years are also raised, although to a lesser degree.
Television advertising: Television is now expected to grow by 9.3 per cent in 2021, an improvement from our prior 7.8 per cent expectation.
Beyond this year, we expect low single-digit growth for the broadly defined medium, including what we call Connected TV+ (the document has a sidebar that details how we are defining Connected TV+).
We estimate that globally Connected TV+ inventory accounted for $16 billion in media company ad revenue, up by 25 per cent over 2020 levels. We anticipate Connected TV+ ad revenue will grow to $31 billion globally by 2026
Audio advertising: Expectations for audio were raised significantly in this update, with a forecast now at 18 per cent growth rather than December’s 8.7 per cent level.
However, following 2020’s 27 per cent decline, even with these revisions, the medium is not expected to return to 2019 levels any time soon.
OOH advertising: Outdoor advertising should fare well, growing by 19 per cent in 2021.
Although our 2021 forecast represents a slightly slower pace of growth than we anticipated in December, 2022 expectations are now slightly higher than before.
Longer-term, OOH is benefitting from growing interest in the medium and is aided by new digital formats that allow for incremental sources of demand to emerge.
Read the full report below.