GroupM believes linear TV impressions among 16-to-24-year-olds will fall by 12% this year, and by 8% among 16-to-34-year-olds, in the UK. The revelation is included in the latest UK advertising forecasts from the media buying group, which also show better than expected overall advertising growth in the country this year. GroupM, which worldwide is responsible for $108 billion of annual media investment, estimates TV’s first decline in five years, in the UK, amounting to a 2.9% reduction in 2017. “But it is likely to stabilise in 2018 in a context of slower audience loss and attractive pricing,” the company says.
Regarding the loss of young linear TV impressions, the company believes some of the loss in viewership may be overstated due to poor measurement of audiences across diffuse TV platforms. “The industry can look forward to some improvement with BARB’s 30-platform Dovetail measurement, due in March 2018. This portends better measurement of video-on-demand, which has already shown good performance, growing investment in 2017 due, in part, to online brand safety scares,” the company says.
Meanwhile, the UK advertising market is growing faster than previously expected and in 2018 will enjoy its ninth successive year of growth. The country will remain one of the fastest-growing media markets in 2018, with a 4.8% increase predicted to take total investment to £19.8 billion, the buying giant says. The 2018 UK expectations have been raised from the 4.5% growth GroupM predicted six months ago. Meanwhile the company estimates that 2017 will conclude better than expected, with investment totalling £18.9 billion (showing 5% growth, up from the 4.1% growth previously predicted for this year).
GroupM is the media investment management company for WPP’s media agencies including Mindshare, MediaCom, Wavemaker, Essence and m/Six. The company characterises the UK as a stable advertising market in an overall low-growth consumer spending environment. “Advertising investment remains stable despite a fragile economy”, confirmed Adam Smith, Futures Director at GroupM.
GroupM is forecasting that digital, ‘pure play’ Internet will hold 60% share of UK ad investment in 2018. “The forces supporting this include rising digital audiences, growing e-commerce and marketer short-termism, where performance-focused digital media is harnessed to drive near-term ROI.” The company believes pure play digital advertising will grow by 13.3% in 2017 and 9.8% in 2018.
Digital advertising may also be beginning to exhibit price inflation as more brands crowd in while data and technology costs rise to enhance quality and ensure viewability, or the ‘opportunity-to-see’, the company says. And Adam Smith warns, “The larger digital looms in share, the more vociferous and voluminous the challenge around measurement, accountability and brand safety will be.”
Some advertisers paused YouTube investment early this year over contextual brand safety concerns, but GroupM estimates that two-thirds of those UK ‘pausers’ have returned at normal investment levels. However, the other one-third may be lingering with addressable TV and other alternatives that they found effective, the company reckons.
The outlook for legacy media beyond television remains tough. In aggregate, ‘legacy media’, including its digital components, will shrink 4.4% in 2017 and a further 2.0% in 2018 according to the new GroupM forecasts. The company is predicting growth levels for out-of-home advertising of zero in 2017 and +2% in 2018 (dependent on expected improvements in effectiveness, automation and efficiency). For national newsbrands (newspapers) the figures are -12% this year and -8% next year, although there are hopes these figures might be mitigated by a new audience measurement initiative called PAMCo.