GroupM’s annual report This Year Next Year a global worldwide media forecast property which dives deep into the media and advertising spend trends across the globe; was released yesterday.
A brief summary of the report states that the global economy has weakened in 2019 and will remain similarly soft in 2020 which clearly does not excite a lot of for us 2020. Despite solid growth in the US and UK, overall conditions lead to predict deceleration in advertising growth this year vs. 2018 and in 2020 vs. 2019.
With regards to global advertising, excluding U.S. and in particular the political advertising which is fairly large enough to distort global growth rates by +/-1% each year, expanded by +5.7% in constant currency terms during 2018 leading to capping the third year of better than +5% growth and the best year of the current economic cycle.
However, 2019 appears set to grow nearly a percentage point slower, which is at +4.8%, and growth is expected to slow down by another percentage point in 2020 and 2021. This Year Next Year forecasts a +3.9% growth next year and +3.1% growth the following year. Growth is expected to range between +3–4% through 2024. Although worse than recent years, the forecast notes that this would amount to a similar pace of growth to what was observed during 2012–2014.
This Year Next Year also estimates that the total global advertising market during 2020 will amount to $628 billion as they define advertising here, but would likely approach $700 billion on a broader definition that includes spending on direct mail and directories around the world.
The report reveals that India is the world leader among other larger media markets in advertising across mediums and will continue to give a stellar performance in terms of numbers with high single digits. The growth rate in ad spends is estimated +12–13% each year from 2020 to 2024, similar to 2019 levels. India along with Brazil is expected to overtake France’s position in terms of advertising numbers.
“In 2020, India faces challenges and uncertainties across sectors just like other markets.” said, Prasanth Kumar, CEO, GroupM South Asia
Adding, PK said, “However, this also brings opportunities for brands to innovate. This will be propelled by greater use of technology and better content across media.”
According to GroupM’s This Year Next Year; the media is only a means to an end: The goal should be to optimize the mix of external and internal resources that drives business growth.