Media Market forecasts
As we came to the end of 2020, there was an uneasy sense of optimism among agencies and media owners. Despite a torrid Q2 and a difficult Q3, the final quarter of 2020 was seeing strong levels of advertising investment across most media. The industry was cautiously optimistic heading into 2021.
The announcement of the third lockdown over the Christmas break, and its subsequent extension, created more uncertainty as we entered 2021. It halted the momentum the market experienced from September last year.
However, as the roll-out of the vaccines gathers momentum and we gradually exit lockdown, we will see a steady increase in the number of brands and services advertising in the market, and investment will grow again. However, the market will remain short-term and volatile across 2021.
When it comes to estimating the volume of advertising in Ireland, the one thing that we can say with absolute certainty is that the market contracted in 2020, but that’s where the certainty stops. Depending on the source, the total spend in the Republic of Ireland in 2020 was anywhere from €774 million to €1.2 billion. This extraordinary inconsistency is untenable, and it portrays the industry in a poor light.
We have taken great care in researching the estimates in this report, but they are just that – estimates. 2021 must be the year our industry comes together to develop a formal framework for publishing actual advertising spends for each medium (in aggregate) and the overall market. This is necessary to facilitate accurate judgement of market trends for all stakeholders.
TOTAL MEDIA MARKET
The advertising market was hit hard in 2020. We estimate that overall spends in the Republic of Ireland fell by 14.2% to €903.1 million. However, this is a far better outcome than was expected earlier in the pandemic when marketing activity was decimated; in Q2 and Q3 last year, spends declined by circa 48% and 29% respectively compared with the same quarters in the previous year. A significant rally in Q4 drove advertising investment up by circa 17% versus Q4 2019, which saved the year, in some respects, for several media owners.
Covid-19 will continue to have an impact on the market in 2021. However, despite the slow start, we expect to see growth this year. We estimate overall investment in advertising will increase by 8.9% to €983.6 million in the Republic of Ireland.
Northern Ireland saw an overall decline in ad spend of 10.7% to £166.3 million (€186.9m) in 2020. This was deeper than the UK market, as a whole, which showed remarkable resilience with a fall of just 7%; this is despite the UK economy recording its biggest decline in activity since the ‘great frost’ of 1709. While the pandemic is still impacting investment levels in Northern Ireland, we do expect growth this year of 8.3% to £180.2 million (€202.5m).