If Mystic Meg and Russell Grant ever get fed up bashing out the horoscopes IAB Europe chief economist Dr Daniel Knapp could well step into the breach, after his forecast that digital media would decline by just over 5% during the first half of 2020 has proved virtually spot-on.
Dr Knapp’s prediction, modelled on macroeconomic indicators back in June, has been confirmed in the latest Digital Adspend data, developed with PwC.
Figures show that the display market has grown slightly – up 0.3% to £2.84bn – driven by a 5.7% increase in video ad spend. Search ads fell by 3.7%, with revenue down by £143m to £3.7bn compared to the first half of 2019. Spend on classifieds was down £235m, to £485m.
IAB UK CEO John Mew said: “The data released today is hugely useful in understanding the health of the digital ad market as a whole and how different areas are faring – yet we know that this continues to be a challenging time for many of our members and that the relatively small decline in digital ad spend at an industry-wide level won’t reflect the individual situations of all.”
In response to the report, Kantar Media’s UK & Ireland chief executive Mark Inskip said that, in the face of continued economic uncertainty, the digital ad market is plainly still feeling the squeeze but that it is not all doom and gloom.
He added: “It’s no surprise that video ad spend, for example, is up by 5.7% as consumers around the globe continue to turn on their trusty TV sets and sign up to video on demand (VOD) services as they spend more time at home.”
Inskip cited Kantar’s own TGI global data which shows that over half of consumers across 25 markets, including the UK, have used a streaming service “in the past week”. Clearly, he added, the lift in spend is reflective of the huge, highly engaged audiences that can now be reached.
He continued: “To get the most out of tight ad budgets as we head into an uncertain winter, it is important for marketers to be aware of both macro and local consumer trends and the evolving commercial opportunities that can be leveraged, as many countries are entering different stages of lockdown.
“Now more than ever, brands and advertisers must be strategic; they must identify key audience trends and stay up to date with developments around the world to carefully plan ad campaigns, ensuring that they digital ads are targeted at the right audience, with the right content, at the right time.”
Meanwhile, Trade Desk senior vice-president for the EMEA region Philippa Snare reckons the 5% decrease in digital adspend is reflective of budgets tightening across the board.
She said: “With marketers scrutinising the performance of every pound, the value of digital advertising can only become clearer. In addition to the crucial ability to turn digital ads on and off at the flick of a switch, it allows marketers to both gain real-time insights into their audiences and to apply data to improve and optimise campaign performance.
“But perhaps most importantly of all, digital channels are where consumers are spending their time – whether for news, work or entertainment. And naturally, where consumers go, brands follow – and this is reflected in the number of marketers learning about and experimenting with new digital channels.
“Video revenue is one of the bright spots in today’s report – something we at The Trade Desk have seen with many agencies including Connected TV as part of their omnichannel campaigns for the first time.
“It is likely that these positive experiences of digital during the first half of the year will continue to drive improved spend in H2 and 2021. There remains uncertainty, but the brands that embrace digital and make the most of all that is has to offer will come out on top.”
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