Online and Digital media forecasts

 In 2020, online media spend experienced its first year-on-year decline. We estimate that advertising investment fell by 9.4% to €477.6 million in the Republic of Ireland. This figure includes search, social, classified and display spends. Display is a catch-all description for online video (including broadcast players), digital audio, email, text and native formats.Despite a slower H1, due to the pandemic, both Google and Facebook experienced growth in their global advertising revenues of 13% and 18% respectively. Google’s growth was driven by a strong Q4 for its search business and a 46% increase in YouTube spends. In the case of Facebook, a 12% increase in daily active users, coupled with an increase in demand for ecommerce advertising formats were key to its increase in revenues last year.Despite their global growth, we believe that Google and Facebook's combined advertising revenue in the Republic of Ireland contracted by 5.5% to €403.1 million. This was driven by sharp declines in spends from SME advertisers, a collapse in key categories like travel and entertainment and an ecommerce sector that still lags behind bigger international markets. Despite this, Google and Facebook still accounted for 84.4% of all online advertising investment and 44.6% of the total media market in the Republic of Ireland last year. 

 For 2021, we expect the online market will increase by 12.9% to €539.4 million, with Google and Facebook growing by 14% and 12% respectively. A continued surge in video investment will benefit both businesses, even though competition from TikTok will increase substantially this year.The dominance of the duopoly continues to have a significant impact on the share of the market available to Irish online publishers and broadcasters. We estimate that the slice of the display market (including video on broadcast players) available to Irish media was just €27 million in 2020. This is expected to grow by about 11% in 2021 to €30 million. This level of investment is not congruent with a thriving indigenous media sector.The online share of the advertising market in Northern Ireland at 39% is lower than the UK and Republic of Ireland with 72% and 55% respectively. In Northern Ireland, the level of online advertising was worth £64.3 million (€72.3m) in 2020 which represented a decline of 4% on 2019. We expect growth of 7.5% in 2021 to £69.1 million (€77.7m).