Warc recently released a report on ‘Global Advertising Trends’. The report benchmarked ad investment by product category. It revealed how different sectors value advertising media and how it has changed over time. In Warcs report, we can see that TV is valued highly as a media form by the soft drinks and food industry. TV is a major stronghold on advertising investment for the industry.
The report also revealed that there’s a widespread shift of ad investment to the online space across all industries. The financial services and retail industries are leading the shift to online ad investments. According to the report, the two sectors have heavily developed digital platforms to serve their customers in recent years.
Warc’s Global Advertising Trends Report
Here’s Warc’s latest report revealed:
Almost half of the $43.2bn invested in advertising by financial services brand was directed towards internet formats last year. It also shows that there has been a dramatic shift to digital over the last five years. The internet’s share of sector spend has grown 22.0 percentage points (pp) since 2013, to 45.5% last year. This figure is just above the internet’s share of global ad spend (44.1%). According to Warc’s report, as a share of sales revenue, the financial sector spends 3.6% on advertising, rising to 6.7% among banks.
The report revealed that almost two-thirds of the $25.3bn in ad investment within the food sector last year was spent on TV. This is nearly double of TV’s global share of 33.3%. According to the report, TV spend in the sector rose 1.0% year-on-year to $16.5bn in 2018 but has dipped by 3.7% each year since 2013 on a compound basis.
Warc’s Report shows that print also accounts for a greater share of food ad spend than is the case globally, with newspapers’ (-2.6pp) and magazines’ (-2.1pp) share dipping mildly over the last five years.
Global ad spend in the retail sector was flat in 2018 at $62.3bn. The $1.8bn in extra internet spend (up 9.1% from 2017) was offset by a decline in spend for all other media bar out of home (+12.7%) and cinema (+4.9%).
The report also revealed that ad investment among the retail sector has tracked downwards in recent years. It recorded a compound annual growth rate of -1.8% since 2013. Online advertising has become far more valuable to the sector during this time.
Soft Drinks Sector
Warc’s report shows that at 70.0%, TV’s share of soft drinks brands’ adspend is higher than all other sectors studied for the report. The $10.5bn spent on TV ads in 2018 was up 1.1% from 2017 and has grown at a compound rate of 2.0% each year since 2013 – bucking the global trend. It shows that investment in other media mainly the internet has eroded TV’s share of sector spend by 4.4pp over the five years to 2018. Internet formats still draw a relatively small amount of investment, at 12.8%; this is almost three times less than the global level and is likely a reflection of how little e-commerce has disrupted the sector.
Toiletries and Cosmetics Sector
Ad investment within the toiletries and cosmetics sector has dipped 4.1% each year since 2013 on a compound basis, to a total of $25.7bn last year. This is largely due to how this spend has been allocated historically: in 2013, TV accounted for two-thirds of ad spend while print drew a further fifth.
Both of these media have recorded declining spend over the period, with internet (+10.7pp) and out of home (+4.7pp) gaining most in share but from a low base – depressing total investment growth in recent years. Print still accounts for 11.4% of sector spend, with magazines alone worth over $2bn, but this total has more than halved since 2013.
Source: Biz Community