Digital advertising is on track to grow 31% in 2021, and will likely account for 64.4% of all advertising this year, according to GroupM’s year-end industry growth forecast. As of December, a total industrywide growth rate of 22.5% is expected for the year 2021.
“It’s possible that this is the fastest growth in the history of advertising,” said Brian Wieser, global president of business intelligence at GroupM.
The projected 2021 total surpasses GroupM’s midyear predictions.
After 2021, stable growth will continue. The high numbers aren’t just the result of ad spend playing catch-up in the wake of the pandemic.
“If an economy is predisposed toward producing brands that differentiate themselves from competitors by the use of paid media advertising, you will get growth in advertisers,” Wieser said.
2022 will see strong growth off a record-setting year. Total growth is estimated at 9.7%, an increase from GroupM’s previous prediction.
What about television?
The television marketplace is changing rapidly, though with more muted growth.
Global TV advertising is expected to grow 11.7% in 2021 – but this isn’t enough to offset the 2020 pandemic-induced decline. The industry isn’t expected to bounce back to 2019 levels until 2023.
One reason for that slower growth is that it’s harder for smaller companies to buy TV ads. Television is historically a brand-building space, using high-quality video messaging to uphold products in the minds of the consumers. And that gets expensive for smaller brands that can advertise strictly online.
What this means for marketers
CTV saw a surge of audience viewership during the 2020 pandemic. CTV viewership currently constitutes 24% of total TV consumption, up from 19% at this time last year.
Marketers who buy ads based on user data, including programmatically, may see this additional ad space inventory as a chance to cash in. But since dominant platforms like Netflix and Disney+ are largely ad-free, and will likely stay that way for the foreseeable future, they may need to come up with some alternate strategies to reach viewers.
The future of TV as a whole will probably mean fewer opportunities for direct advertising, Wieser predicted. But this isn’t admitting defeat – it’s an open door into other possible opportunities for brand-building budget allocations.
Companies should look for new ways to collaborate with streaming platforms and borrow their “brand equity, connecting their service to the brand in the mind of the consumer,” Wieser said.
Some brand-affirming strategies might include sponsorship, special promotions or brand integration, like the last time you noticed an Apple iPhone or other branded product in the background of your favorite Netflix binge. If media owners choose partners they believe share in their values, they are in a strong position to further bolster their brand even as TV becomes a more challenging place for direct advertising and the opportunity to gain a viewer’s attention.