Despite enjoying millions more unique users in recent weeks (courtesy of the lockdown), digital media businesses are losing money due to current work restrictions.
With millions of people spending much more time on mobile, social and digital channels, you’d think it would be a good time for online publishers and ad agencies. It’s not.
While Irish publishers are reporting an average growth of nearly 50% in unique users, the pandemic is playing havoc with the digital advertising market in Ireland.
According to a survey of IAB Ireland members, most Irish publishers (68%) and ad agencies have experienced a significant decrease in revenue since the COVID-19 work restrictions began. 82% have also implemented some form of staff cutbacks on salaries and working hours.
“A third of advertiser and agency IAB members report pandemic related business challenges as their most significant barrier to advertising,” says Suzanne McElligott, CEO, IAB Ireland. “However, the lockdown has also dramatically increased digital consumption with local publishers reporting an average growth of 49% in unique users over recent weeks.”
A boom in 2019 will burst in 2020
The IAB has also just released the figures for digital advertising spend in Ireland in 2019.
The total digital ad spend was €673m reflecting year-on-year growth of 17% for 2019. The spend on social advertising and video advertising was up 39% year-on-year and 42% respectively.
Recognising the impact of COVID-19, IAB Ireland’s advertiser and agency members predict a 10-20% decrease in digital ad spend in 2020.
Despite the current gloom, 73% of survey participants remain optimistic and say the digital advertising market will rebound between Q3/Q4 2020: (49% predict the rebound in Q4, 24% in Q3).
“Leading advertising practitioners, researchers, and academics are reminding brands of the value of continuing advertising during challenging times such as this,” says McElligott. “Brands that maintained advertising during previous recessions experienced a positive impact on their sales and market.”