The Irish advertising market will emerge from recession in 2014 and grow for the first time in five years, according to forecasts by consultancy firm Accenture and media buyers GroupM. However, both companies expect print advertising will continue to decline as clients follow the audience to digital media products.
Accenture Media Management Ireland predicts overall 3 per cent growth in the market this year, while GroupM, the umbrella group for WPP media agencies including Maxus, Mindshare, MediaCom and MEC, expects a more modest 1 per cent increase in business.
"With the market showing signs of positive momentum across a number of media, particularly in the second half of 2013, we anticipate that 2014 is the year when the advertising market will finally move out of recession," says Accenture's Grace Gallagher.
Accenture places the decline in the market last year at 1 per cent, which itself is a substantial improvement on the 6 per cent drop the previous year. Out-of-home advertising, which had a poor 2012, was the only medium apart from digital to show growth last year.
As might be expected, the fastest-growing medium this year will once more be digital. Accenture is again slightly more bullish than GroupM, forecasting growth rates of up to 15 per cent, with mobile the clear hot ticket. On the other side of the equation, print advertising revenues will decline 7 per cent, Accenture predicts, notwithstanding expected improvements in property and motor advertising.
Print advertising
“No medium has felt the impact of digital so deeply as print,” says Gallagher. Both suppliers of print inventory and advertisers “need to move faster” to take advantage of increased mobile penetration, she added.
GroupM said digital would grow by 10 per cent this year, giving it a 21 per cent share of the overall market, or revenues of about €153 million. It also said print advertising spending would continue to retreat, despite the fact that most of the main titles now offer combined print and online deals to advertisers.
"Although modest, it's great at last to see some spend growth forecast to return to the Irish advertising market," says GroupM Ireland chief executive Bill Kinlay. "Hopefully it will mark the beginning of the end of this long hard recession."
GroupM conceded that its 1 per cent growth forecast for Ireland was “very low”, but added that investment in advertising could be negatively affected by ongoing euro zone austerity. “Both locally and globally, GroupM and its holding company WPP are citing caution.”
While Ireland’s expected advertising growth is close to the 2 per cent rise predicted by GroupM for western Europe, and ahead of forecasts for Germany, Spain and France, it lags the 6 per cent increase forecasted for the UK market, where digital now commands almost 50 per cent of the total market.
