The latest global advertising trends report from WARC reveals that annual spend in OOH and Cinema spend – dubbed IRL (In real life ad economy) – will amount to $44.4bn, just $0.7bn down on the amount spent in 2019.
The report also reveals the recovery will continue into 2023 when the IRL ad market is predicted to reach a new high of $47.1bn.
Alex Brownsell, head of content, WARC Media: “WARC’s analysis of the IRL ad economy shows that brands understand the role that channels like OOH and cinema play in the media mix, and that they are investing ahead of activities such as commuting, in-person socialising and in-store shopping returning to pre-pandemic levels.”
This positive news comes after few parts of the media industry saw fortunes fluctuate during the pandemic to quite the extent as experienced in OOH, but a forecast of $10.9bn globally means the sector is starting to recover in 2022.
However, there is a note of caution as the current recovery from COVID-19 may only be completed in 2023. Of the current figures only Australia (+1.5%) and the US (+0.9%) can expect OOH ad spend in 2022 to match, or better total annual ad revenues from 2019. In contrast the biggest slump is most pronounced in India (-42.1%) and Brazil (-27.4%), while investment in Italy is forecast to be 21.0% down on pre-COVID levels, meaning there is a still a long way to go.
Hampering the recovery is the rising OOH media costs with global inflation in the channel hitting 9.4% in 2021 and forecast to reach 4.6% in 2022, as advertiser demand increases and the costs of running digital signage increase in light of rising energy prices.
In terms of cinema China’s ad spend here has soared to $1.1bn, which is a huge 10.4% increase on pre-Covid revenues
Box office hits like Spider-Man: No Way Home suggest COVID-19 has not extinguished the enduring appeal of an outing to the cinema. Nevertheless, there is also a note of caution here as not everywhere is seeing similar results to China. As an average annual global ad spend on cinema will reach $3.4bn in 2022, short of the peak of $3.8bn in 2019 with the US cinema ad spend being 60.3% lower than total revenues in 2019.
Brownsell added: “Brands are preparing for a future dominated by virtual interactions in the metaverse. However, it’s vital that marketers do not neglect those all-important physical moments between our digital experiences.”
Despite these notes of caution there is cause for optimism that the industry is back on the rise.