OOH expected to grow by 19% in 2021: GroupM Mid-Year Forecast
By M4G Bureau - June 15, 2021
The GroupM ‘This Year, Next Year’ report released this month cites that global advertising is also expected to grow by 19%.
The GroupM ‘This Year, Next Year’ Global Mid-Year Forecast on advertising released this month cites that midway through 2021 “It has become apparent with the market is growing much faster than be expected and from a larger base then we previously believed. While many of these growth factors were in place before last year the pandemic has proven to be an accelerant”. However, there could be still be some headwinds for the media and advertising businesses going forward. The report states that “There a wide range of potential disruptions to be overcome. Globally we can point to issues like supply chain disruptions and higher levels of general market inflation. Additionally, many individual markets have yet to emerge from the depths of the pandemic.”
The risks notwithstanding, global advertising is expected to grow by 19% (excluding US 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 cites that “in absolute terms, we now expect global advertising including US political to exceed $1 trillion in 2026, up from $641 billion in 2020 and $522 billion in 2016.”
In 2021, several major ad markets are expected to clock over 20% growth. The report forecasts 20% growth in Indian market.
Globally, OOH is expected to grow by 19% in 2021, and then by a CAGR of 6.8% through 2026. “Although 2021 forecast represents a slightly slower pace of growth than we anticipated in December (at which time the forecast 21% growth), 2022 expectations in all slightly higher than before. These differences can be explained by noted that return to normal outdoor activity by consumers and advertisers is returning, but at slightly slower pays than previously anticipated. Longer-term, OOH is benefiting from growing interest in the medium and is aided by new digital formats that allow for incremental sources of demand to emerge. Better targeting, the capacity for real time and/or programmatic buying and the increasing number of locations for digital signage are all positive factors,” the report states.
Cinema advertising will partially recover this year, although a return to the 2019 levels will not likely occur in the near-term.