Spain and India to lead growth in video entertainment ad spend: Zenith report
The agency reveals findings of a report that analysed 10 global markets which contribute to 57% of the global ad spends
Nov 02, 2020 03:11:00 AM | Article | Campaign India Team Share -
According to a Zenith study, video entertainment advertising will shrink by just 0.2% in 2020 across ten key markets (India, Australia, Canada, Germany, Italy, Russia, Spain, Switzerland, the UK and US). Other advertising will drop by 8.7% across these markets during the year according to the report titled ‘Business Intelligence – Video Entertainment’.
The report studies video entertainment, ie, long-form video content supplied by conventional TV or online – including free TV, pay-TV and online VOD platforms.
It stated that during the lockdowns in these 10 markets (which contribute to 57% of the global ad spends), consumers turned to video content to keep themselves informed and entertained. In France, TV viewing time was 30% higher year-on-year in April, and was still 11% higher in August.
Christian Lee, global managing director, Zenith, said, “Consumers are now faced with a vast and confusing array of programmes and films vying for their attention. Video brands need to cut through this complexity and give consumers entertainment that matches their personal preferences with minimum fuss. Brands that provide compelling experiences and act as more than just repositories of content will be best positioned for growth in the long term.”
Spain and India to lead growth in video entertainment ad spend
In 2022, video entertainment brands are forecast to spend 27% more than in 2019 in Spain, and 19% more in India. Both the countries are experiencing a fast-growing appetite for video-on-demand, especially on smartphones in India. India’s TV ad market also enjoys rapid long-term growth (unlike most Western countries) and should bounce back quickly in 2021 according to Zenith’s report. At the same time spending in the US and Australia will decline by 5 and 7% respectively.
The US is the only market where video entertainment ad spend is expected to continue to decline after 2020, as rising online revenues fail to compensate for the ongoing declines in TV advertising and pay-TV subscriptions, reducing available ad budgets.
Joanthan Barnard, head – forecasting, Zenith, said, “Consumers are currently benefiting from a generous supply of video content from brands vying for their loyalty. This competition is providing a large boost to video entertainment ad spend this year. But this level of investment in both content and advertising will prove difficult to sustain for the long-term, and we forecast very little growth in 2021 and 2022.”
Video entertainment ad spend to exceed 2019 peak by 1.2% in 2022
While video entertainment is expected to substantially outperform the market in 2020, Zenith forecasts it to underperform over the next two years, with no growth in 2021 and only a 1.3% growth in 2022.
This is attributed to online video platforms not having the capacity to raise budgets after spending heavily in 2020. The study by Zenith adds that traditional TV broadcasters will be weighed down by the shrinking revenues from TV advertising and pay-TV subscriptions. The agency expects video entertainment ad spend to be 1.2% higher in 2022 than it was in 2019, while overall advertising will still be 0.6% below its 2019 peak.