Picture: 123RF/SSILVER
Picture: 123RF/SSILVER

After a year of diminishing work volumes, low returns, retrenchments and the implementation of survival strategies, the advertising industry is hoping for a better 2021 as clients start to lift their heads above the parapet.

Media agency Zenith predicts the global industry is set to grow by just under 6%. But the first quarter is going to be tough.

Karabo Songo, CEO of the Brave Group, says: "As revenues and budgets get tighter, client teams will start to shrink, placing major pressure on client/agency relationships." He says a continuing focus on the pandemic and economic disaster will result in social regeneration efforts in the industry slowing down, which means BEE will suffer.

Phumi Mashigo, founding partner of the Ignitive agency, says reduced budgets will be a boon for digital agencies given a huge rise in targeted and automated ad buying.

Karabo Songo
Karabo Songo

Jacques Burger, co-founder and group executive at M&C Saatchi Abel, says 2021 might be the "mullet year" for advertising — all tough and serious at the start but lightening up towards the second half. Burger believes that in the first half agencies will focus on retention and relationship marketing while navigating tough conditions, but will later become more acquisition-focused to land consumers who will start to look elsewhere if their brands have not supported them or added value.

As Boomtown agency CEO Glen Meier sees it, brands will look to marketers for help as they adapt to changing Covid-19 regulations, requiring flexibility to turn advertising on, or off, completely. "For the marketing services industry to keep pace, it is critical to remain on top of the latest touch-point additions to digital ecosystems, such as connected TV and mobile in-app advertising."

Grey Group CEO Paul Jackson suggests 2020 will in some ways be remembered as more of a mild setback than an industry-changing economic catastrophe for the media business. "Global advertising spend weathered the storm relatively well and will end up declining by 5.8% on an underlying basis."

Phumi Mashigo
Phumi Mashigo

He expects a "stuttered" local recovery, with patchy growth as the vaccine rolls out and businesses and consumers get back on their feet.

WPP’s GroupM has a more optimistic outlook than Zenith and expects the global ad marketplace to grow 12.3%. It sees adspend growth across all five regions, led by Latin America (24.4%) and Asia-Pacific (14.1%).

Globally, digital media spend is forecast to increase 14.1%.

Nahana Communications Group CEO Brett Morris is taking a cautious approach to the first half. "Many of us hoped, against better judgment, that when the calendar ticked over to 2021 things would somehow get a lot easier. Well, despite what we may have wished for, the world was not going to miraculously change. If anything, it’s likely to be a lot more challenging than we expected. We don’t know the extent of the challenges or opportunities the year will bring but we can choose to focus our energy on the opportunities."

Derek Coles
Derek Coles

McCann 1886 MD Derek Coles says: "Our role as advertising agencies is going to be how we help our clients continuously adapt to the ever-changing landscape and reignite themselves, internally and with their customers. The agile agencies will help their clients survive and prosper in 2021."

HaveYouHeard co-founder Jason Stewart says: "What is most likely is that we will be in this state of uncertainty and flux until the end of 2021."

The situation doesn’t bode well for brands or advertising agencies as many brand budgets will be cut and many of their ad agencies will need to downsize.

However, it is not all doom and gloom as some industries will be more buoyant than others. Says Stewart: "It is not the upcoming year that will determine the success of an agency, it is how well an agency has set itself up for the year."

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