GroupM on Monday released its global mid-year media forecast that detailed how at the midpoint of 2021, advertising growth for the year is far exceeding previous expectations. “In total, we expect global advertising to grow by 19% (excluding U.S. political advertising) during 2021, a significant upward revision from expectations we held at the time of our prior publication at the end of 2020. This represents a level of ad revenue that is 15% higher than 2019, as 2020 only experienced a 3.5% decline on our revised estimates. High growth should persist for the foreseeable future, too. Our new forecasts now extend to 2026 and show a compounded annual growth rate (CAGR) of 6.3% between this year and then,” the report ‘This Year, Next Year’ stated.
In absolute terms, the report now expects global advertising including U.S. political to exceed $1 trillion in 2026, up from $641 billion in 2020 and $522 billion in 2016. To be noted, concentration within the industry has increased over this time: in 2020, the top 25 media companies represented 67% of total advertising revenue. That same group of companies accounted for 42% in 2016.
Moreover, several markets are expected to see better than 20% growth, including the U.K., Brazil, China and India. Many others will rise by the high teens, including Canada, Australia and the U.S.
In terms of digital advertising, which saw tremendous growth in the last year, the report expects 26% growth for all forms of pure-play digital media versus 15% at the time of its December update. Expectations for other years are also raised, although to a lesser degree. Meanwhile, television advertising is now expected to grow by 9.3% in 2021, an improvement from the prior 7.8% expectation. “Beyond this year, we expect low single-digit growth for the broadly defined medium, including what we call Connected TV+. We estimate that globally Connected TV+ inventory accounted for $16 billion in media company ad revenue, up by 25% over 2020 levels. We anticipate Connected TV+ ad revenue will grow to $31 billion globally by 2026,” the report added.
Interestingly, expectations for audio advertising have been raised significantly in this update, with a forecast now at 18% growth rather than December’s 8.7% level. However, following 2020’s 27% decline, even with these revisions, the medium is not expected to return to 2019 levels any time soon.
Outdoor advertising should fare well, growing by 19% in 2021, the report stated. “Longer-term, OOH is benefitting from growing interest in the medium and is aided by new digital formats that allow for incremental sources of demand to emerge,” it added.