In so many aspects, 2020 has been a tumultuous year for everything and advertising decisions are no different. This year has been embraced by Pandemic, Activism, Politics and we still have six months or so to go! To spend or not to spend is the question every brand manager has amid the coronavirus pandemic forthcoming multiple recessions. All markets are currently witnessing a droppage in spending, except the Chinese market. Is this a sign for the rest of the markets in this lifecycle? Google will see its first ever contraction in digital ad revenues, as search advertising will struggle compared with display.
What are the predictions?
Overall ad spending will decline by 4.9% worldwide this year, a significant drop from last year’s 6.3% growth and from our pre-pandemic 2020 forecast of 7.0% growth. The total figure will come in at $614.73 billion, which represents $76.99 billion less new revenues than previously expected.
Will digital ad spending perform better?
With other options not available, worldwide digital ad spending will achieve 2.4% growth this year, the lowest on record. Although this figure is still positive, the category has never been in single digits. The $332.84 billion total for 2020 represents $36.11 billion less spending than our pre-pandemic forecast.
Is it Google Vs Facebook?
Multiple brands opting out of advertising on Facebook, but will still see Facebook with a 5.9% growth on the basis of its display business. This is still a significant downturn compared with Facebook’s 26.6% growth in ad revenues in 2019.
Google will suffer a 3.3% loss in ad revenues this year (its first negative result since our tracking began), driven in part by a huge decline in travel-related search queries.
KEY STAT: Digital ad spending will grow 2.4% worldwide this year, the first time on record that growth has been in single digits. The $332.84 billion total for 2020 represents $36.11 billion less spending than our pre-pandemic forecast anticipated.
Brands spending wisely and linking retail management with brand off take will be able to optimize their spending, even spending less would lead to greater productivity and return on investment.