Irish advertising market to grow 10.9% this year

The Irish advertising market will increase 10.85 per cent to €1.23 billion this year despite seeing "a little slower than expected" growth in its opening months, according to marketing group Core.

The predicted boost in investment by advertisers will follow a stronger-than-anticipated rebound of 20.5 per cent last year, which saw the revenues that advertisers spend in the Republic crossing back over the €1 billion mark to an estimated €1.11 billion.

Increases were seen across all forms of media, including print, as confidence returned to the market.

Core chief executive Aidan Greene said strong economic forecasts had informed its calculations for the year ahead, but noted that the group's annual Outlook report was being published at a time of uncertainty and crisis, with consumers in Ireland becoming more conscious of inflation affecting their spending power.

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The shift to online investment is set to continue, meanwhile, with many consumers having embraced digital media for the first time during the pandemic.

“Pre-pandemic, just under 50 per cent of investment in the Irish media market was on digital media, including video, social, search and display. Today, that proportion has increased to 56.3 per cent,” Mr Greene said.

“As the world reopens, consumers are now choosing their preferred way to be educated, entertained and empowered.”

Core, which is the largest buyer of advertising in Ireland, said global inflation trends and geopolitical developments would result once again in “a short-term and volatile market”, with growth in expenditure and pressure on the supply of “quality” media inventory contributing to higher prices for advertisers.

Print advertising revenues rose 2.9 per cent in 2021 to €82.6 million, as the recovery from 2020’s Covid-triggered contraction led to the first year-on-year increase for this medium in five years.

Print

However, Core predicts that spending by advertisers on print will resume declining this year, with a drop of 4.8 per cent to €78.6 million expected.

The marketing group forecasts growth across all other media in 2022, with news publishers seeing the print decline offset by an increase in digital ad spends with their titles. After “significant” growth in 2021, these are likely to expand almost 12 per cent to €37.4 million this year.

Total online advertising investment “reaped the benefits of continued lockdown and restrictions” in 2021, with revenues across search, social, classified and display ads – including online video – growing 26 per cent to about €603 million and forecast to swell more than 15 per cent this year to €695 million.

Google and Meta have "continued to be the main beneficiaries" of this growth, with the two tech giants estimated to account for 85 per cent of Irish online ad spending, or a sum of about €513 million in 2021, with €286 million of this relating to Google's search revenues.

Meta’s Irish revenues are forecast to grow 23 per cent this year, notwithstanding any impact from Apple’s iOS update, which requires users to opt-in to being tracked by apps.

Online video advertising surged 39.4 per cent last year to €206 million, with Meta-owned Facebook and Instagram accounting for 71 per cent of this market. Google-owned YouTube also had "a strong year", with its revenues in the Republic believed to risen 25 per cent to €22.8 million, while broadcasters' players achieved average growth of 20 per cent.

Meta’s share of this year’s online video revenues will reach 79 per cent, Core said, with the market forecast to expand about 21 per cent to €250 million.

Television and other media

The television market is expected to grow a further 6.8 per cent this year to €276 million, after bouncing back 21.6 per cent last year to almost €260 million.

Both television spot advertising and sponsorship revenues grew in 2021, with finance, consumer goods, television and broadband, retail and government among the key categories on the rise.

Radio advertising will grow 3.2 per cent to €112 million this year, after recording a 6 per cent rise in 2021, while digital audio revenues from podcasts and streaming will expand 16 per cent to cross the €10 million threshold after a surge of 30 per cent last year.

Out-of-home advertising is forecast to increase almost 19 per cent to €67.5 million this year after growth of more than 17 per cent in 2021, but the market will remain short of the €90.7 million investment recorded in 2019, Core said.

It is a similar story for cinema advertising. While cinema ad revenues of almost €2.2 million last year were up 68 per cent on 2020, the market – once again truncated by lockdown closures – was still just a third of that recorded in 2019.

The forecast of almost €4 million cinema ad spend for this year, a jump of 82.5 per cent, suggests the recovery will not be completed in 2022.

Core acknowledged that estimates of the total size of the Irish advertising market vary and expenditures cited for each medium can be “wildly different”. It called on the media industry to publish more regular market data.