The impact of the UK’s strict third lockdown on newsbrands is reflected in new figures showing ad spend declined by one-third at national and regional titles in the first quarter of 2021.
Despite the hit to spending at the start of the year, overall UK ad spend is forecast to grow by 18% in 2021 to reach a total of £28bn – completely recovering 2020’s £2bn decline.
The UK market is expected to be worth a record £30bn in 2022.
The forecasts in the latest quarterly expenditure report from the Advertising Association and marketing agency WARC suggest the UK will see the fastest ad trade recovery in Europe this year.
Advertising Association chief executive Stephen Woodford said this was “hugely encouraging” for the UK and reflected “fast-rising corporate and consumer confidence” as well as the successful Covid-19 vaccine rollout.
Despite rapid growth in spending expected this year the report said most media will not recoup their 2020 losses until 2022. Exceptions include online national newsbrands, online consumer magazines and TV.
Lockdown hit to non-online formats
In January to March, when the UK was under its third strict Covid-19 lockdown, national newspaper ad spend (print and online) fell by 19% year-on-year to £176m while regional ad spend fell by 22% to £117m.
However national online spending grew by 10% to £77m and regional by 9% to £58m.
Despite this, both newspaper sectors are expected to see overall growth in 2021 following the worst of the pandemic last year when national ad spend fell by 24% and regional by 35%.
In 2021 national newsbrands will increase ad spend by an anticipated 12% overall and 18% online.
Regional spend will grow by an estimated 12% overall this year and 27% online, while next year an overall decline of 2% is expected, but with online growth of 3%.
Magazine brands were not as badly hit as their news counterparts in the first quarter of this year, with a decline of 14% overall to £111m and growth of 13% online to £50m.
Magazines, a slightly smaller market than regional newsbrands in 2020, expect faster growth this year of 18% overall and 28% online – although they may see a similar total 2% decline in 2022 as print continues to shrink.
Online formats were the only platforms to grow during the first quarter, with the exception of 0.3% growth for TV.
James McDonald, head of data content at WARC, noted that 70p in every £1 spent on UK advertising is now invested digitally, a rate that is now surpassed only by China.
“It is these formats that will lead absolute growth over the coming terms and none more so than paid search, which is seen to be benefitting from burgeoning e-commerce trade,” he said.
“That the ad market will generate more value this year than before the crisis is testament most to its role within the lives of the connected consumer.”