- According to a new forecast, the ad industry may be on the path to full recovery in 2021. Total ad sales have declined sharply in recent months due to the pandemic, but massive political ad spending along with a recovering economy are poised to mitigate much of that decline. (Advertising Age)
- NH: In the early months of the pandemic, the ad industry took a big hit. Total ad sales dropped sharply (-7.2% in Q1 and Q2 2020). Ad sales for linear media like broadcast TV and radio fared especially poorly (-23.1%). The lone bright spot was digital ad sales, which grew 5.7% over this period.
- But things may be looking up. According to the latest U.S. Advertising Forecast from Magna, the ad industry is on track to recover most of its losses in 2021. This prediction is based on four factors: (1) continued growth in digital ad sales; (2) the return of sports, giving advertisers a boost; (3) a gradual return to “normal life” that will boost ad spending for nonessential goods and services and on more expensive nondigital ads; and (4) most significantly in the near term, an unprecedented surge in political ad spending.
- Magna’s report projects that the 2020 election will set a record for political ad spending, with total spending climbing 32%, or by $5 billion, compared to 2016. An analysis by the Center of Responsive Politics found that with candidates spending less on travels and events due to the pandemic, they’re spending more on ad blitzes to make up for it. In Q2 2020 alone, Trump and Biden spent a combined $121 million on media ads.
- Michael Bloomberg alone spent $1 billion on his ill-fated primary run, more than half of which paid for digital and TV ads. (In return, he picked up exactly four delegates from American Samoa, a stunning reminder that, no, people can't just "buy themselves" into politics.)
- By type of media, most political spending in 2020 has gone to targeted ads on Facebook and Google. But the $121 million for Q2 is a very large number. Four years ago, in Q2 2016, Trump and Clinton’s combined total was much less: $72 million. And as the election nears, ad spending typically accelerates upward at an exponential pace.
- Of course, all this election-related spending is only providing a short-term boost. Advertisers’ long-term fate is more closely tied to how the overall economy performs. And that remains a big unknown. When will there be a market again for, say, travel ads? All that airlines and hotels and tour companies can do is wait.
DID YOU KNOW?
- Bring on the Cameras. Facial recognition technology has gradually made its way into more public spaces, schools, and offices. And according to a new survey from Schoen Cooperman Research, most Americans don’t mind. Over half (59%) say they have a favorable view of facial recognition technology. Only 24% have an unfavorable view. When it comes to different uses, Americans are most supportive of facial recognition being used by airlines (75%), security staff at office buildings (70%), TSA or other airport security (69%) banks (68%), and elementary through high schools (67%). Meanwhile, two-thirds (66%) support its use by police and law enforcement. There’s also broad support for facial recognition at institutions that are arguably less security-oriented, including colleges and universities (57%) and retail stores (51%). In general, most Americans are inclined to think that the positives of facial recognition outweigh the negatives: 68% believe it “makes society safer,” and 57% would agree to have their image included in a database used to promote public safety.