Agencies Expect ‘Notable’ Ad Rebound in 2021 From Pent-Up Consumer Demand.
Top execs at radio’s publicly-traded companies consistently pointed to improving ad bookings in fourth quarter 2020. Now new data from Nielsen shows how that trend played out across the larger advertising ecosystem.
In January and February 2020, before any shutdowns, ad spend was up 4% from 2019, according to Nielsen’s “Total Audience Report: Advertising Across Today’s Media.” Second quarter 2020 marked the trough with a 28% year-over-year decline in total advertising, followed by a 25% drop in Q3. But by Q4 2020, declines had slowed considerably and were down just 5% from the final quarter of 2019. Nielsen Ad Intel data also documents the Q4 2020 upswing: insurance ad spending rose 14% and socially distanced areas like online retail shot up 24% year-over-year.
Consumers, meanwhile, are chomping at the bit to resume activities put on hold by the pandemic. An advertising survey fielded by Nielsen in February 2021 showed that 55% of participants said they are very optimistic or optimistic that they could get back to their normal routine in 2021, although the results varied by gender: 63% of adult men noted this optimism, compared with just under half (49%) of adult women.
About one-third (32%) of those surveyed think they’ll resume their normal activities within the next six months. Adults 35-49 are more optimistic about the timeline, with 38% of that demo thinking a return in six months is on the horizon. Only 20% of adults over 50 say this emergence will happen in the next half-year. Hispanics (37%) are most optimistic that activities will resume within six months, while Asian Americans (26%) are least optimistic.
“Marketers seeking to capitalize on the positive outlook of the people need to take into consideration the specific needs and challenges faced by all groups, and present their messages accordingly and with the proper balance of enthusiasm and empathy,” Nielsen says in the report.
The consumer survey shows pent-up demand for a wide range of activities. Nearly three-fourths (73%) of U.S. consumers are very or somewhat eager to take a vacation. Even more Americans are looking to satiate their desire for in-person religious services (75%) and engage in a little spa therapy (74%). But the survey shows Americans are eager to resume all sorts of social activities, whether it’s dining out (73%), working out (68%), or rocking out (67%) at a live concert or performance.
Shutdowns and restrictions forced Americans to put vacations and spending on big ticket items on hold last year and that allowed some to save up for major purchases when the pandemic subsides. Between 40%-45% of 18-49 year old consumers attributed saving more money than they normally would to COVID-19 related restrictions. “There is a prime opportunity to redirect that savings back into the economy with the right marketing strategy,” the report says.
In fact, 16% of adults18-49 plan on making the purchase they had postponed within the first three months of COVID restrictions being lifted.
In a stat ready-made for ad sellers looking to drum up more business from auto dealers and realtors, 40% of adults 18+ say they intend to purchase or lease a new/used vehicle in the next 12 months, while 20% say they intend to buy a new house.
As the pandemic put extreme pressure on local businesses like restaurants, bars and bowling alleys, many radio stations responded by supporting them with free on-air and online promotion. The Nielsen survey shows that was a smart strategy as focus on local businesses has taken priority in urban areas. Nearly three-quarters (74%) of respondents felt it was very or somewhat important to shop in person at local businesses and 66% of urban dwellers say they’re more likely to remember an ad for a local business than one for a national chain or online outfit.
And four in ten urban consumers say they’re shopping at local businesses with more regularity.
Download the full Nielsen Total Audience Report HERE.