As the Advertising Industry Struggles, Digital Marketing Stays Afloat

The advertising sector, like all other industries, is feeling the effects of the COVID-19 crisis. Magna Global, IPC Mediabrands’ media strategy branch, expects significantly lower US ad revenues in the second quarter of 2020 compared to last year. Local TV ads, radio ads, and print ads will be particularly affected: the forecast predicts contractions of 30 per cent, 34 per cent, and 40 per cent, respectively, for those channels. The impact on digital marketing will be less severe.

A modest recovery is expected starting in 2021, with slower growth than previously anticipated until 2024. Magna had forecast that US advertising revenues would reach $745 billion next year; that number has been revised down to $647 billion.

“Beyond the short-term V-shaped recession/recovery impact on the economy and the advertising market, the Covid crisis will have global and long-term effects on society, business models, consumption habits, mobility and media usage,” said Vincent Letang, Magna’s evp of global market research, per Adweek.

The silver lining in Magna’s report is that digital advertising has emerged from the crisis in an enviable position. Revenues are expected to grow by two per cent in 2020, powered by 10 per cent growth in video advertising and seven per cent growth in social media ad revenues. A further 4 per cent growth is expected in 2021.

There are no ‘winners’ of the COVID-19 pandemic. Every industry in every country has been affected, and even those companies that have experienced growth understand that their success is coming at the expense of public health and the wider economy. However, the digital marketing industry is positioned to emerge from the crisis stronger than it entered. Social distancing measures have pushed more money online and increased rates of online transactions.

As a Google Premier Partner digital marketing agency with years of experience in all areas of online advertising, GrowthEngine Media can help your company establish a solid virtual presence that will serve you well throughout the COVID crisis and in the years to come.


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