This February trends article delves into three topics which have hit the headlines and got our attention. We’ve seen a robust growth and optimistic forecasts in ad spend and marketing budgets, read a different angle on the evolving AV landscape as global streaming giants have begun to collaborate to meet industry standards and explored the expanding reach of media owners through strategic partnerships, understanding the potential benefits this has for agencies like us and brands themselves.
Trends in spend: Budget growth predictions
It’s been well publicised in the past month that the UK ad market is experiencing strong growth. Spends are predicted to skyrocket this year with predictions reaching £39bn in 2024, up from £37bn in 2023, based on industry reports from the Advertising Association and WARC. This is mainly influenced by increased online consumer spending and, surprisingly, this isn’t expected to slow down in 2024 despite economic challenges. Based on trends reported at the end of last year, marketing budgets are also growing at their fastest rate in nearly a decade which is a positive and refreshing outlook, particularly for agencies. This optimism about the industry is also supported by the IPA Bellwether Report, which revealed the strongest marketing budgets in almost a decade. The buzz of 2024 major events such as the Euros, the Paris Olympics and the expected UK general election should ensure the upward trend in ad spend is maintained throughout the year.
The AA and WARC have raised their growth forecast for UK ad spend in 2023 to 6.4%, with a further increase of 5.9% expected in 2024. Notably, events marketing performed the best in the final quarter, with a positive balance of 15.9%. Spending on search is expected to rise by 8.7% and online display by 7.4%. TV is set to grow by 1.4%, largely driven by a 14.6% increase in BVOD. Radio and out-of-home advertising are also anticipated to grow by 2.1% and 7.3% respectively, while cinema is expected to grow by 4.6%. However, online classifieds, direct mail, national and regional news brands and magazine brands are forecasted to decline in spending. This is reflective of the trends we are seeing with our clients and hearing from our partners & media owners.
These predictions gives us a lot of hope and excitement for the industry and the year to come.
Streaming services pave the way for the changing AV landscape
February saw the headlines that Thinkbox has welcomed Amazon, Disney+, Netflix, Vevo and Warner Bros Discovery as associate members. These companies will support Thinkbox’s marketing activities for TV advertising, contribute to its research program and engage with the media & marketing industry in the UK. The industry then saw Amazon Prime Video joining Barb in a similar move, following Netflix and Disney+. This means viewing data for Prime Video will now be available to Barb subscribers. Amazon’s decision to join Barb coincides with its recent introduction of ads on Prime Video, expanding beyond special programming to all content. Other streaming platforms such as Paramount+ and Now are also Barb subscribers due to their relationships with Channel 5 and Sky.
These moves reflect an evolution in the AV industry as global streaming platforms integrate into traditional measurement systems, these joint memberships underscore the importance of collaboration and standards in the advertising industry. It also demonstrates the rise of streaming and changing viewer habits.
Media owners broadening reach through partnerships
It was announced recently that Pinterest has entered into a new ad partnership with Google in a move designed to boost its ad revenue. This marks Google as the second third-party ad partner for Pinterest, following its multi-year collaboration with Amazon that was unveiled last year. This collaboration provides an opportunity for brands running campaigns with Google ads to not only broaden their reach but also engage with an active, high-value consumer base. This has the potential to lead to stronger return on investment and increased conversions. Pinterest initiated the rollout of the new ad integration a few weeks ago and is reportedly experiencing positive results. Following a similar pattern to the Amazon integration, the Google integration is expected to be phased in over several quarters.
From a media agency perspective, this will be an option for us to look into in the future as this is expected to be phased across the next few quarters. It’s likely that, similar to the capabilities of YouTube advertising within the Google ads platform, there will also now be a section for Pinterest advertising which would allow for much better tracking of campaigns, especially for e-commerce clients who are likely to benefit from this roll out. We would also expect to see competition and costs increase within Pinterest as more and more users will now see Pinterest as an easier and simpler way of advertising.
Everyone benefits from this exciting partnership. Pinterest earns valuable advertising revenue to improve user experience and creator tools. Google expands its reach to a more engaged global audience. Creators have the chance to build sustainable income streams and share their passions with the world. Importantly, users will hopefully find exactly what they’re looking for, thanks to more relevant and targeted ads that seamlessly blend into their discovery journey.
Sources:
https://www.alfinsight.com/blog/ad-market-outperforming-wider-economy
Advertising Association/WARC media expenditure report
IPA | Q4 2023 IPA Bellwether Report
https://the-media-leader.com/amazon-disney-netflix-vevo-and-warner-bros-discovery-join-thinkbox/
https://yourstory.com/2024/02/google-ads-come-pinterest-new-monetization-path
https://searchengineland.com/pinterest-ad-partnership-google-437390
