Anyone looking to the GroupM “This Year, Next Year” media spend forecasts for clues as to whether the direct mail recovery is under way or not could be left scratching their heads after the agency decided to omit the £2bn medium from its latest report.
Whether it had its fingers burnt last year – when it said mail would see its best performance in years, only for it to slump to a new low – is anyone’s guess.
According to the 2018 prediction, direct mail was poised to witness only modest growth – +0.7%, compared with +0.9% in 2017 – but it would be worth more, £1.5bn compared to £1.49bn last year.
These figures did not take into account unaddressed mail, door drops and leaflets, meaning spend would have been well over the £2bn-mark. As it transpired, direct mail volumes shrank by 8% and spend was down 6%.
In its latest report, published today, GroupM sticks to far safer ground, predicting that the UK ad market is set to increase to £21.8bn in 2019, up from £20.5bn in 2018, on the back of 6.1% growth this year.
This is being powered by digital advertising, which will account for 60% of total spend, half of which is attributed to search. Within the segment, digital posters are reported to have accounted for half of all out-of-home spend in 2018 and will rise another 3% in both 2019 and 2020.
TV ad revenues will remain flat, at £4.5bn, which is equivalent to around 20% of all media spend, but even then they will be shored up by new entrants to the market taking advantage of data-driven audience targeting techniques.
Radio is forecast to grow at a steady 2% next year but newspapers and magazines will continue to suffer, declining by an average of 4%.
A GroupM spokeswoman said: “We simplified the report to media-only the last time, and deleted direct mail along with PR, and market research. We kept TV and radio sponsorship though as these are important to those media. A lack of intel was the reason; and a lack of interest.”
Last week, direct marketing industry chiefs pooh-poohed predictions that direct mail volumes will continue to dive for the next 12 months at least, insisting that clients are already flocking back to the medium in their droves.
For those seeking an accurate prediction of which way the direct mail wind will blow, they could do worse than stick a wet index finger up in the air.
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