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Zenith’s Ad Spend Forecast Report predicts that global ad spend will grow 5.7% in 2023 and 7.4% in 2024 as brands continue to use advertising to drive e-commerce growth. According to the report, the global advertising market grew 15.6% in 2021 after experiencing a slowdown in 2020. From now on, it will continue to achieve growth of 9.1% in 2022.

Global ad spending has been estimated to reach $ 705 billion in 2021, up from $ 634 billion in 2019. Additionally, it will reach $ 873 billion by 2024.

This forecast was prepared before the emergence of the omicron variant, and the travel, hospitality and brick and mortar retail industries were found to face downside risks. But there is potentially a benefit for e-commerce and the associated digital advertising.

Many consumers who would rather browse and buy in person are shopping online out of necessity. Companies have responded by investing more than would otherwise have been justifiable in new technologies, infrastructure, organizational changes and advertising. This includes brand advertising to promote e-commerce platforms, performance advertising to drive traffic to them, and advertising within such platforms (“retail media advertising”) to promote specific products, where they all increased.

Over the past six months, it has become clear that booster injections are necessary to maintain the effectiveness of vaccines, that fully vaccinated people are able to transmit infections quite easily, and that large segments of the population do not want to. not get vaccinated at all. Progress towards containing Covid-19 has been slower and consumers have been less willing to resume shopping in person. Companies continued to make increased investments in digital transformation, during a period when many expected consumers to return to stores.

Digital advertising was therefore stronger than expected in the second half of this year. Digital advertising is estimated to grow 25% year-over-year in 2021, up from 19% estimated in the previous forecast, released in July.

The report projects global digital ad spend growth of 14% in 2022, down from a previous forecast of 10%, followed by growth of 9% in 2023 and 10% in 2024.

This structural change in the economy means that advertising is playing a bigger role in growing sales through e-commerce. This has triggered a surge in retail media advertising: display or search ads that appear on e-commerce platforms.

Retail media advertising is estimated to have grown from 24% growth in 2019 to 53% in 2020 and then to 47% in 2021, for a total of $ 77 billion. This equates to the money spent on newspaper, magazine, radio and movie advertising combined. This represents 20 percent of all spending on digital signage and paid search advertising. By 2024, retail media ad spend is expected to reach $ 143 billion, and 27% from display and search.

The share of global GDP (gross domestic product) contributed by advertising had grown steadily before the pandemic, from 0.72% in 2014 to 0.75% in 2019. After the dramatic shift in digital media consumption and commerce electronics last year, it is expected to reach 0.77% in 2021 and 0.80% by 2024. This will be the largest increase in the share of advertising in GDP since the late 1990s .

The Central and Eastern Europe (C&E Europe) and Middle East and North Africa (MENA) markets are expected to show the fastest growth between 2021 and 2024, with average annual growth rates of 12.2% and 10% respectively. European C&E advertising is fueled by increasing productivity and disposable income as its economies mature towards maturity, encouraging more brands and product categories to enter the market. The MENA region, meanwhile, is benefiting from high oil prices as demand for energy has outpaced production. The slowest growth is expected in mature Western European markets, where growth is expected at a good level of 5.3 percent per year.

The largest contribution to the growth in ad dollars is expected to come from the United States, where ad spend is expected to increase by $ 80 billion between 2021 and 2024. This represents 48% of the total ad spend growth worldwide during this period. period. The next growth will come from China ($ 15.8 billion, or 9% of the total), the United Kingdom ($ 6.0 billion, or 4%) and Japan ($ 5.4 billion, or 3%) . . These are the world’s four biggest ad markets and they make up for in scale what they maybe lack in speed.

Social media has been predicted to be the fastest growing channel between 2021 and 2024, with an average annual growth rate of 14.8%, closely followed by online video at 14%. Paid search will grow 9.8% per year, primarily driven by retailer media, and outdoor advertising will experience solid 7.4% annual growth as foot and car traffic return to normal. Radio and television will experience marginal growth of 2.2% and 1.4% respectively, while print media will decline 4.7%.

The cost of TV advertising is predicted to increase by 11% in 2022, compared to 4% for outdoor advertising, 3% for digital signage, 2% for radio and zero for print. Brands will have to deal with their dependence on a medium that systematically offers a smaller audience for higher prices.

Multiple platforms deliver content through multiple devices to multiple screens, while advertisements can be delivered through a chain of demand-side platforms, exchanges, ad networks, and content delivery networks before reaching the consumer. But, by investing in data and planning technologies and partnering with vendors, brands can use online video to increase reach and reduce costs. Advertising spending for online videos has been predicted to rise from $ 62 billion in 2021 to $ 91 billion in 2024, when it first exceeds 50% of that television size. TV advertising spending will grow from $ 171 billion to $ 178 billion over the same period.

According to eMarketer, adult social media users in the United States spend 60.4% of their time with Facebook and Instagram this year, up from 74.8% in 2017. This is the result of the rise of TikTok, which went from zero to 15.1 percent. percent of social media use during this period. Platforms also embrace commerce and develop new, advanced interactions between brands and consumers. Brands can use self-service tools to create augmented reality experiences and then deliver them through targeted ads, which can dramatically increase awareness and purchase intention.

Zenith expects social media ad spend to reach $ 177 billion in 2022, overtaking television at $ 174 billion. Social media ad spend will hit $ 225 billion by 2024, when it will account for 26.5% of all ads, followed by paid search at 22.5% and television at 21.0% . Digital advertising will exceed 60% of global ad spend for the first time in 2022, reaching 61.5% of total spend, and increase its share to 65.1% by 2024.

Jonathan Barnard, Head of Forecasting: “As consumers increasingly rely on digital technology to connect and entertain them, and to inspire and satisfy their purchases, advertising is playing an increasingly important role in the growth of businesses. sales and brand, ”said Jonathan Barnard, Head of Forecasting, Zenith. “Over the next three years, we expect the advertising market to achieve its highest sustained growth rate since 2000.”

Jai Lala, CEO of Zenith India, said: “Digital transformation in India continues to be a priority with 1 in 2 companies having digital transformation at the heart of their concerns. The pandemic has further accelerated digital growth among consumers with increased consumption across all platforms in entertainment, shopping, social, education and finance, among others. All of these factors have led to a steady increase in ad spending, making digital the fastest growing medium. “

The research, conducted in collaboration with data science firm Signify Group, found that the abuses included sexist, racist, transphobic and homophobic content, as well as unfounded doping charges.