GroupM predicts audio advertising could drop by 19% this year
Advertising agency GroupM has released its mid-year report which paints a dark picture for the advertising market, including radio and podcasts.
The new global This Year, Next Year forecast – released to the market today – predicts global audio advertising is likely to decline by 23% in 2020 as advertisers disinvest.
The verticals that face the biggest challenges are travel, automotive and much of the entertainment industry which remains at a standstill due to social distancing.
The good news is that the WPP-owned media agency is projecting about 25% growth in ad spend in Australia next year, following a deep slump from the pandemic fallout in 2020.
The major concern for some big spenders is the fact that audiences are spending less time in their cars due to the lockdown and the number of people working from home.
“While severe to be sure, 2020’s decline can still be considered ‘modest’ given the scale of the impact of the pandemic on global GDP, which will fall by much more than it did in the 2009 global financial crisis,” says GroupM.
“In some, the economic consequences of 2020 will outlast the discovery of a vaccine. In others, pent-up demand is expected to over-compensate for 2020’s losses.”
Audio’s total global ad revenue will equal $25 billion this year and with relatively high levels of listenership and reach, should continue to make the medium effective.
According to GroupM, in 2020, the global advertising economy will fall by 11.8%, excluding the effects of increased political advertising in the U.S.
This is a sharp decline from the growth rate from 2019 of 6.2% and returns the industry to slightly higher than 2017 levels in constant currency terms.