GLOBAL ADVERTISING MARKET REACHES NEW HEIGHTS, AND EXCEEDS PRE-COVID LEVELS

KEY FINDINGS

1. Globally, media owners’ advertising revenues grew by +22% in 2021 to reach a new all-time high of $710 billion, following a decline of -2.5% in 2020. Advertisers spent an additional $126 billion on top of the 2020 tally. The global marketplace is now 19% larger than pre-COVID levels and will continue to grow steadily in 2022 (+12%).
2. Advertising revenues from traditional advertising formats (TV, radio, OOH, print, cinema) grew by $21 billion (+9%) following a -17% decline in 2020, to reach $268 billion; this puts traditional formats at 90% of the pre-COVID market size (2019).
3. Digital advertising sales (search, social, video, banners, digital audio) increased by $105 billion (+31%) to reach $442 billion; digital formats now represent 62% of total advertising sales worldwide.
4. Advertising growth is fueled by strong economic recovery (global GDP +5.9%) and personal consumption, as expected, but the magnitude of growth rates suggests it is more than just the marketplace catching up post-COVID and organic growth factors are driving the tremendous digital acceleration of 2021.
5. Among those factors are the growth in digital media consumption and the explosion in e-commerce scale and depth, which prompted big brands and – especially – small businesses to increase digital marketing activity and ramp up their use of social and search formats.
6. All major industry verticals increased ad spend this year. Drinks, Entertainment, Retail and Technology were among the most dynamic spenders, while Automotive ad spend stalled after a strong first half, due to the semiconductor shortage reducing production and sales.
7. Ad spend grew in all 70 ad markets monitored by MAGNA and reached double-digits in 68 out of 70. Several of the world’s largest markets posted above-average growth including the US (+25%), the UK (+34%), Brazil (+30%), Canada (+27%) and Australia (+23%), while China (+17%) and India (+14%) experienced below average growth.
8. Looking at 2022, supply chain issues will slow down some verticals, and the tail end of COVID variants may still inhibit growth in a small number of markets, but growth factors are strong enough for MAGNA to forecast further growth in advertising spending. Economic growth (global GDP +4.9%) and large-scale vaccination will spur consumer mobility and the recovery of some laggard verticals (Travel, Movies), while digital marketing will continue to grow organically, and no less than three cyclical events (Winter Olympics, US Mid-Term elections and FIFA World Cup) will bring billions of incremental marketing budgets.
9. In this environment, the global marketplace will grow by +12% to reach $795 billion. Linear ad format growth will slow down to +4% (still a stronger performance than the pre-COVID trends) while digital ad formats will grow by +17%.
10. The 2021 US ad market grew by +25% to reach $284 billion, with pure play digital ad sales up +37% and traditional media owners ad sales up +8%. In 2022, Economic growth (GDP +3.9%) and political spending will continue to fuel ad sales, despite supply-chain issues slowing down some verticals in the first half. The market place will grow by +13% (digital pure play +18%, traditional media owners +4%) and pass the $300 billion market for the first time, to reach a new all-time high of $320 billion.
 
Vincent Létang, EVP, Global Market Research at MAGNA and author of the report, said: “The global ad market recovered above and beyond the economic recovery in 2021. Mature linear ad formats recovered to 90% of the pre-COVID level, just as the economy did. Digital ad formats, by contrast, grew much faster than expected, driven by multiple organic growth factors, e-commerce boom being the most significant. Traditional, brand- and privacy-safe media remain crucial to building consumer brands, as shown by the strong demand boosting TV costs in 2021, but marketers are increasingly diversifying into digital formats to reach hard-to-reach audiences, improve ROI and connect more seamlessly to e-commerce. This once-in-a-lifetime planet alignment of growth factors led to the unprecedented market growth we experienced in 2021.”
 

GLOBAL AD MARKET: +22% TO $710 BILLION

The global economy has recovered in-line with expectations (GDP +5.9% vs +6.4% expected in April) and, in most markets, so has marketing activity and advertising spending. Growth was particularly strong wherever COVID vaccination was fast and deep and allowed full business re-opening early in the year: US +6.0%, UK +6.8%, France +6.3%. Some other large markets displayed tepid economic recovery by comparison, due to underwhelming vaccination and lingering COVID restrictions and/or a manufacturing sector crippled by supply-chain issues: Japan +2.4%, Germany +3.1%. Throughout the world, consumers spent more money than ever in 2021, using the forced savings they built up in 2020 as soon as restrictions to mobility and shopping were relaxed in the spring or summer. In that environment, national brands and local businesses competed to be the first or the most effective in reconnecting with consumers. Ad spend also benefited from the added driver of rescheduled international sports events (Summer Olympics, UEFA Euro).
 
Global all-media advertising spending grew by almost +22% to reach a new all-time high of $710 billion. This +22% growth represents the highest growth rate ever recorded by MAGNA, beating +12.5% in 2000 and a significant increase from MAGNA’s previous global forecast (June 2021: +14%). Coming after the COVID lockdowns of 2020, and fueled by the gigantic Government stimulus packages, 2021 was always expected to show record growth, but again, this is growth in excess of recovery. The compounded advertising market growth over the two years 2020-21 was +9%, higher than the average growth experienced during the four years before COVID (+6% per year between 2016 and 2019). It shows that, on top of economic recovery and COVID control, several organic factors drove the tremendous acceleration of 2021 (detailed below).
 
Linear ad format sales (TV and long-form video, radio, print, OOH, cinema) grew by +9% to reach $268 billion worldwide, regaining $21 billion of the $50 billion lost in 2020 (-17%). Global linear sales are thus back to 90% of pre-COVID (2019) levels. Most of the growth came from demand-driven inflation in media costs, rather than increased volumes, ad loads or impressions. Linear TV CPMs for instance, grew by an average +13% globally due to strong demand from many key industries (Retail, CPG/FMCG) and shrinking supply (linear viewing resumed its long-term decline following the COVID surge in 2020). As a result, TV spending grew by +9% in 2021.
 
While mature linear ad formats recovered more or less in-line with the economy, digital ad formats proved once again that organic growth factors – beyond simple economic and marketing recovery – are turbocharging adoption and spending. Changes in lifestyles, media consumption, and business models continued to fuel an acceleration in digital marketing from national consumer brands as well as small, local and “direct” advertisers. Digital growth from consumer brands comes partly at the expense of traditional linear channels, but in the case of small businesses (who represent the bulk of search and social ad spend and are growing much faster than big brands), it is almost entirely incremental money being added to the advertising pie. Digital advertising formats (search, social, video, banners, digital audio) grew by +31% to reach $442 billion or 146% of the pre-COVID market size. Digital ad formats now account for 62% of total advertising sales worldwide. All digital ad formats grew by double-digits in 2021, led by digital video formats (long and short form) +37%, social media +34% and search +33%. Pricing was also a key component to spending growth in 2021. Supply increased too as digital video and social media continue to grow in reach and time spent, but this still was not enough to meet exploding demand, which led to double-digit inflation in CPM or CPC costs.
 
Back to traditional ad formats, TV did well in 2021, with global ad sales reaching $168 million (+9% and 98% of the pre-COVID level) but radio was even stronger, although it had more ground to make up: +16% to 28 billion (89% of 2019 sales). Print ad sales were flat around $43 billion but when adding back the digital ad sales of news and magazine publishers, total print-related ad sales were up approx. +10%. Finally, out-of-home media sales grew by +12% to $27 billion. The slower and more gradual recovery of OOH was expected due to the declines in consumer mobility, particularly in the heavily advertised transit segment, hurting OOH media audience and reach for most of 2021. OOH global ad sales stand at just 83% of their pre-COVID level at the end of 2021, but MAGNA is confident that ad sales will increase by double-digits again in 2022 and grow back to the 2019 level by 2023.
 
In 2021, all seventy ad markets analyzed by MAGNA recovered to some degree. Sixty-eight out of 70 markets reached double-digit growth. Several of the worlds’ largest markets posted above-average growth including the US (+25%), the UK (+34%), Brazil (+30%), Canada (+27%) and Australia (+23%) while China (+17%) and India (+14%) grew below average. Growth was above average in EMEA (+23%), North America (+25%) and LATAM (+26%, partly driven by economic inflation).
 
Looking forward to 2022, there are two potential threats to the global economy and the advertising marketplace: COVID and supply chain issues. Turning first to COVID, the recent increase in cases and endless controversies about vaccination and passes should not hide the good news that the war against COVID is nearly won thanks to vaccination. Cases have increased again in 4Q21 to reach 500,000 daily worldwide by mid-November, but remain well below the previous peaks of 800,000 cases per day and, more importantly, the number of deaths remains relatively low (7,000 daily). That is because 4.2 billion people have already received at least one dose of vaccine, representing more than half the world’s population (60% to 80% in most Western countries). Beyond some renewed mobility restrictions promulgated e.g. in Austria, Netherlands and Germany, most Government policies are prioritizing booster shots, encouraging or even mandating vaccination (Austria from Feb. 2022) rather than bringing back strict restrictions to circulation and business that hurt the economy. We are therefore optimistic that 2022, if not entirely COVID-free, will at least be exempt from the more severe policy responses that preceded vaccine availability and contributed to economic pressures in 2020 and the early part of 2021.
 
The second risk lies with supply-chain issues, including the insufficient supply of semi-conductors causing some industries, most notably automotive, to cut production, as well as the insufficient capacity in global shipping and raw materials. We believe the latter issues will self-adjust gradually throughout 2022 as demand cools down and capacities recover, but there is uncertainty about how long the semiconductor shortage will affect the automotive and technology industries. We have factored this in as a headwind for media types that rely particularly on the automotive vertical, for instance local television in the US.
 
These risks and headwinds are largely offset, in our view, by the drivers on the horizon: strong economic growth (the IMF predicts +4.9%), further mobility recovery (esp. for transit), continued organic digital growth fueled by e-commerce, and no less than three cyclical events generating incremental advertising spending (Winter Olympics, US Mid-Term elections and FIFA World Cup). MAGNA thus predicts the global advertising market to grow by +12% and reach $795 billion in 2022. Linear ad format growth will moderate to +4% (still a stronger performance than pre-COVID) while digital ad formats will grow by +17% and reach 65% of total ad sales.
 
Next Global Ad Spend update: June 2022
 

US MARKET REACHES THE $300 BILLION MARK

Boosted by economic recovery, advertising sales grew by an estimated +25% this year to reach $284 billion. The US ad market growth was slightly above the global average (+24%). All major industry verticals increased ad spending by double digits, with technology (+29%), retail (+28%), entertainment (+27%) and finance (+25%) leading the way.
 
All media channels benefitted to a degree. Cross-platform long-form video advertising sales grew by +6% to $66bn. Of this, national ad sales increased by an estimated +10% to $47bn. Broadcast/cable linear ad sales were up +7%, while long form AVOD and OTT/CTV devices gained an impressive +36%. Finally, video pure players (short form video) increased +47% on the strength of YouTube and Twitch. Conversely, local TV and video ad sales fell -3% as local broadcast ad sales were off -5% without the tailwind to the record political spend in 2020. Cross platform audio ad sales rose +25% to $16bn on the strength of digital audio and podcasting (+68%). Total publishing ad sales stabilized (+2% to $16.6bn), as growth in digital ad sales (+18%) offset the continuing declines in print ads (-12%). Out-of-home advertising sales increased by +14% to $7.1bn, driven by strong demand for roadside billboards (+17%) and street furniture (+11%) which more than offset the slower recovery of the transit segment (-14%). Cinema ad sales grew by a +53%, as theaters reopened mid-year and blockbuster really came back in 4Q. Full-year ad sales are less than a third of what they were pre-COVID, but cinema should benefit from 12 months of normal behavior and normal releases in 2022. Direct mail ad revenues grew +13% (excl. political spending) in 3Q and should post +8% to $16.5bn for full year 2021.
 
Digital pure player ad sales (search, social) were up +35% to $162bn, thanks to robust gains in search (+39%) and social media (+36%). At the end of 2021, the “COVID Recovery Index” for ad spending will reach 125% overall (25% above 2019 levels): 87 for linear ad sales and154 for digital ad sales. By the end of 2022 the recovery index will stand at 140.
 
Looking at 2022, there are some headwinds to consider. The huge fiscal stimulus, that so effectively kept the American economy running through COVID, will gradually fade away, and supply chain issues might get worse before they get better. Many industries are facing the combined effects of production bottlenecks caused by strong demand (e.g. microchips), supply chain delays and disruption (e.g. imported food products, clothes), logistical bottlenecks, and higher costs for raw materials, commodities and energy. The impacts are multiple: limited supply, delays, and rising costs affecting end consumers.
 
Looking at the key advertising verticals, MAGNA rates the supply chain impact as “high” for Automotive, Consumer Electronics and Toys/Games, meaning the impact on business (supply and sales) may be severe enough that some brands may slow down marketing spending for several months. These industry verticals represent approx. 9% of full-year linear ad spend (linear TV, radio, OOH, print), and just 8% of national TV ad spend. Looking at a typical 4Q, the contribution of these verticals is only slightly higher for national TV (10% of typical 4Q ad sales) but significantly higher for social media (16% compared to 6% FY). The impact is deemed “moderate” or “low” for other industries, and non-existent for some (Finance, Insurance, Entertainment). If we bundle the industries with a “high” and “moderate” impact, we find that a third of national TV ad sales could be exposed to some degree in the next few months. However national TV’s ad revenues will be cushioned in the short term by the upfront system, where 4Q ad spend commitments are not cancellable.
 
Tailwind factors continue to outweigh the supply-chain issues, however. MAGNA predicts advertising sales to grow by double digits again in 2022: +13% to $320bn, as robust economic growth continues (+3.9% real GDP growth, still faster than the long-term, pre-COVID trend of +2% to +2.5% per year) and two cyclical events (Winter Olympics in February, and Mid-Term elections) will generate billions of incremental ad spend from brands and political groups.
 
Pure play digital advertising sales will increase by +17% to $190 billion, as search (+18%) and social media formats (+18%) drive growth, while cross-platform long-form video ad sales will rise +4% to $68 billion. National TV/video ad sales will be flat, as growth in long-form AVOD (Hulu, FEPs) and OTT/CTV platforms (+29%) will offset a -5% decrease in broadcast/cable linear ad sales. Audio ad sales will grow +6% to $17bn thanks to the continued growth in podcasting, and the return to normal life which will cause an increase in commuting and terrestrial radio listening. Conversely, publishing ad sales will fall -1%, as digital growth – which will account for 60% of publishing ad sales in 2022 – of +10% will be offset by print declines of -15%.
 
Every industry will have increased ad spend above their pre-COVID levels by 2022, with the greatest growth coming from Finance, Entertainment, Retail and Technology.
 
Next US Ad Spend update: March 2022
 

TABLE 1: GLOBAL AD REVENUES

 

 

TABLE 2: US AD REVENUES

 

 

ABOUT THE RESEARCH

The MAGNA research is media centric. It monitors net media owners advertising revenues based on a bottom-up analysis of financial reports and data from media trade organizations; other ad market studies are based on tracking ad insertions or consolidating agency billings. The MAGNA approach provides the most accurate and comprehensive picture of the market as it captures total net media owners’ ad revenues coming from national consumer brands’ spending as well as small, local, “direct” advertisers. Forecasts are based on economic outlook and market shares dynamic. The full report contains more granular media breakdowns and forecasts to 2025, for 70 markets.
 

ABOUT MAGNA

MAGNA is the centralized Mediabrands resource that provides media marketplace intelligence and negotiation prowess for Mediabrands agency teams, affiliates and clients. MAGNA infuses the organization with knowledge that empowers better decision-making, including insights, forecasts, and strategic relationships.
 
MAGNA has set the industry standard for more than 60 years by predicting the future of media value. We publish more than 40 reports per year on audience trends, media spend and market demand as well as ad effectiveness.
 
To access full reports and databases or to learn more about our market research services, contact [email protected].

NEW RESEARCH BY MAGNA HIGHLIGHTS THE IMPORTANCE OF CONSUMER MINDSET IN CONTEXTUAL TARGETING

Study Reveals Brands Must Move Beyond Basic Demographics & Tap into People Mindset to Create People-Centric Experiences

 
New York, NY – November 17, 2021 – A new study by MAGNA Media Trials, MAGNA’s industry-leading proprietary research offering, in partnership with GumGum, the leader in contextual intelligence technology, finds that contextual targeting can achieve what other audience targeting solutions can’t: the ability to harness the consumer mindset to drive impact.
 
The new report, “Mindset Matters: Deconstructing Contextual Video,” found that reaching people when they are in a relevant mindset is the driving force behind advertising effectiveness. The study also found that ads that are delivered within contextually relevant environments are more positive for people and work harder for brands.
 
Mindset plays the biggest role in driving action. 61% of the impact on Search Intent is driven by an individual being in the mood for the brand’s message. By targeting against contextually relevant content, brands reach equally relevant consumers (e.g. ad for new lipstick placed in content about top make-up trends). Because the ad is relevant to the content people have chosen to watch in that moment, the consumer is in a relevant mindset when viewing the ad.
 
“While we’ve seen the power of contextual in our research, it was fascinating to finally identify the strongest driver of contextual performance – mindset,” said Kara Manatt, SVP, Intelligence Solutions, MAGNA. “Reaching the right people is always important, but reaching people at the right time, when they are in the right mindset for the message, strongly contributes to impact on brand KPIs, such as brand favorability and purchase intent.”
 
Mindset and Relevancy Drive Results:

  • When there’s alignment between the ad and the content, search intent is up +7%, brand relevancy is up +6%, and brand is rated as one that knows how to get people’s attention, up +5%.
  • Contextual video targeting drives considerable metrics for brands, with brand favorability up +4%, recommendation intent up +5%, and search intent up +6%. Further, contextual improves ad experiences for people with 10% feeling the ad was relevant to them and 6% finding the ad entertaining.
  • The study found that video content is 47% more effective at reaching the right people at the right time, with 60% of people feeling the ad was something they were open to at the time, and 52% feeling that they were in the mood to view the ad. All brands more effectively reached people in the market for their product category with contextual targeting.

 
Moving Beyond Metadata:
The study rigorously tested the impact of contextual video targeting and set out to identify any differences between the use of metadata only versus a contextual intelligence engine and targeted across three tiers: demographic targeting, contextual targeting via metadata, and contextual targeting via contextual intelligence engine.
 
The difference between the two contextual targeting methods is that metadata is defined as videos sourced contextually with metadata only (e.g. video title, video description, tags) while the other is videos sourced with a contextual intelligence engine, which uses a combination of machine learning techniques (computer vision & natural language processing) to analyze video frames, audio, and text. These techniques work together to understand the full nature of video content and classify full-page content like a human would for the analysis of: video metadata, audio transcription, on-screen imagery, and optical character recognition.
 
“To put it bluntly – most of the contextual technology emerging today is just keyword analysis rebranded, categorized, and focused on targeting rather than avoiding. Sophisticated contextual technology, like GumGum’s Verity, that truly understands all the signals in an environment (text, imagery, video, and audio) can’t be built in a month or even a year. It’s a model that has to be trained continuously over long periods of time in order to get it right,” said Phil Schraeder, Chief Executive Officer, GumGum. “This study proves why the distinction between the two types of contextual technology is important for advertisers to understand. In order to use contextual to drive campaign outcomes the technology needs to be able to understand the actual video not just the words describing it.”

  • Going beyond metadata creates 12% stronger alignment between ad and video content.
  • When gauging ad opinions based on targeting type, contextual targeting via intelligence engine achieved extremely strong results. 75% of people felt the ad was aligned with the content and 56% felt the ad was something they were in the mood for.
  • Video ads are 2.3x more memorable with contextual targeting via intelligence engine in place: +21% unaided brand recall at the first mention when using contextual targeting via intelligence engine.

 
Precise content alignments demand advanced methods for content identification: While broader contextual categories (beauty) are often ideal to extend reach, sometimes more precise contextual alignments are desired (lipstick). Contextual targeting via intelligence engine trumped targeting via metadata with recommendation intent up +12%, brand favorability up +9%, and brand relevancy up +8%.
 
The study conducted controlled testing on mobile to participants from a nationally representative panel that were randomized into test and control groups. Each chose video content to view based on their interests, on premium websites and were then served a pre-roll ad. Brands that participated were two leading beauty brands, a real estate company and a mobile phone provider.
 

The full study can be found here.

 
About GumGum
GumGum is a global technology and media company specializing in contextual intelligence. For over a decade, we have applied our proven machine learning expertise to extract value from digital content for the advertising and sports industries. Our proprietary contextual intelligence engine uses computer vision and natural language processing technologies to scan text, images and videos when evaluating digital content. Combining our contextual advertising intelligence with proprietary high-impact ad formats, GumGum’s advertising solutions deliver industry leading efficiency, accuracy and performance.
 
About MAGNA
MAGNA is the leading global media investment and intelligence company. Our trusted insights, proprietary trials offerings, industry-leading negotiation and unparalleled consultative solutions deliver an actionable marketplace advantage for our clients and subscribers.
 
We are a team of experts driven by results, integrity and inquisitiveness. We operate across five key competencies, supporting clients and cross-functional teams through partnership, education, accountability, connectivity and enablement. For more information, please visit our website: https://magnaglobal.com/ and follow us on LinkedIn and Twitter.
 
Media Contact:
Zinnia Gill
Mediabrands
Director, Global Corporate Communications
(646) 965-4271
[email protected]

Why proper use of contextual targeting needs to focus on mindset more than metadata, report

By Michael Bürgi, Published by Digiday
 
In the latest chapter of the never-ending search for effectiveness married with efficiency, IPG’s MAGNA unit, through its MAGNA Media Trials arm, has joined forces with GumGum to study optimal times and ways to employ contextual targeting. Their ultimate revelation: it’s all about using context when the consumer’s in the right mindset.
 
Given that contextual targeting is GumGum’s principal line of business, it comes as little surprise that the study’s bottom-line finding is that, when used properly, the tactic can deliver better results for clients. It may sound a bit obvious, but when you dive into the details of properly leveraging mindset, contextual pulls off a few statistical surprises, according to the research, said Kara Manatt, senior vp of intelligence solutions at MAGNA.
 
Sharing the report exclusively with Digiday, Manatt noted that the Media Trials team came back to the topic of contextual targeting because of the advancements in machine learning and other technology that enable a more nuanced understanding of content beyond just reading metadata. It’s also why MAGNA chose GumGum as a partner to conduct the report, entitled “Mindset Matters: Deconstructing Contextual Video.”
 
Four of IPG’s clients were recruited to participate, in the categories of retail, beauty, real estate and telecom, but Manatt declined to identify them.
 
Some of the report’s results:

  • When there’s alignment between a given ad and the content it appears in, search intent rises by 7 percent while brand relevancy rises 6 percent.
  • The study also found that contextual video targeting has the potential to bump up brand favorability by 4 percent, recommendation intent by 5 percent and search intent by 6 percent.
  • Video content is 47 percent more effective at reaching the right people at the right time, with 60 percent of respondents feeling the ad was something they were open to at the time, and 52 percent feeling they were in the mood to view the ad.

 
“Contextual is always going to be very important because you’re not using personal information, you’re simply targeting the content,” said Manatt. “But is it the right people or the right mindset that’s driving effectiveness? What we found was, while it’s always important to reach the right people, really the powerhouse behind contextual is the fact that you’re reaching people in a relevant mindset.”
 
Although contextual video was the only medium explored in the study, Manatt said she believes the findings can apply to any use of contextual targeting. “With more accurate and better data, you’re going to do a better job aligning and identifying what is and isn’t contextually relevant for a brand.”
 

Read the full study.

 

Read the article at Digiday.

The “reliability and quality” of news content plays a significant role in achieving brand safety, new study finds

By Michael Bürgi, Published by Digiday
 
The public’s perception of news may not be at a high-water mark, but recent research out of IPG’s MAGNA unit, in partnership with Disney’s Ad Sales unit, indicates that news content still delivers value for advertisers because of the way news is valued by consumers.
 
In a study titled “No News is Bad News: Ads in News & Other Types of Content,” the bottom-line finding is that the source of the news a brand appears in is more important than the content around the ad. In other words, quality and reputable journalism — what Joshua Lowcock, and global brand safety officer with IPG Mediabrands and chief digital officer, UM, calls “Capital J journalism” — can help a brand resonate better, and in turn brands should consider supporting reputable journalism to a greater degree.
 
It’s no coincidence that this sentiment comes at a time when the public has been hungry for pandemic-related information and news. News viewers are “a smart and curious audience, who are interested in learning about the world around them. Tailoring your message accordingly matters and trustworthiness matters,” said Asaf Davidov, vp of measurement and insights, Disney Ad Sales. Likewise, news content “is just as effective as non-news content, and in some instances more impactful because you’re aligning yourself with trustworthiness as a pretty important component,” he added.
 
Other findings from the study, which focused on Disney’s news products including all content out of the ABC News division (including World News Tonight), ESPN and other streaming services, include:
 

  • Guidance on ad messaging subtleties between hard news and softer or more culture-driven news. In hard news, a more direct, product focused ad message delivered higher brand impact, with favorability rising 10% over benchmarks, research intent up 5% and purchase intent up 7%. In race and culture news, on the other hand, a storytelling approach for brands yielded 11% better favorability 10% better purchase intent.
  • News perceived as “heavy” isn’t necessarily a bad place for brands to appear adjacent to; the study showed it can actually drive brand impact. Brand favorability rose 7% and intent to recommend the brand rose 5% from ads in news perceived as “heavy” or “sad” by participants.
  • 57% of the study’s respondents felt that brands should vet the news source before advertising on it, but that rose to 61% among more affluent households (incomes of $100K+) and dropped to 52% among households making $35K or less.

 
MAGNA and Disney are both taking the study’s findings out to their respective clients. “It aligns with our broader approach on media responsibility, which is ensuring that making this connection to where you spend your money matters,” said Lowcock. “We now have demonstrable evidence that when you spend your money in places that matter, you get a better brand outcome. They’re two good narratives.”
 
Both Davidov and Lowcock dismissed concerns that the research could be used by less reputable news outlets to try to legitimize themselves. “The underlying thing our research is around is that the reliability and quality of the source is important,” explained Lowcock. “But there’s separate work we’re doing to validate the reliability and credibility of that finding. High ratings do not translate to reliability.”
 

Read the article at Digiday

 

Download the full study

BREAKING NEWS: NEW RESEARCH STUDY BY MAGNA & DISNEY ADVERTISING SALES EXPLORES BRAND EFFECTIVENESS IN NEWS PROGRAMMING

Study Finds Brands Should Support Quality Journalism & Optimize Ad Strategies Across All News Genres

 
New York, NY – November 2, 2021 – Brand safety concerns have been widespread in the last few years, with many marketers becoming increasingly focused on ensuring safe and relevant environments for their advertising. A new study by MAGNA Media Trials, MAGNA’s industry-leading proprietary research offering, in collaboration with Disney Advertising Sales, “No News Is Bad News: Ads In News & Other Types of Content,” reveals that the news source a brand is featured in matters more than the surrounding content. The study also found that having a presence in reliable news sources drives better ad effectiveness. Additionally, a marketer’s ad strategy should be customized and tailored by news genre to deliver optimal ROI.

The mission of the study was to uncover the true impact of advertising within news and define guardrails for it as well. A key finding of the study is that ads in news work just as well as in non-news and even have a strong positive impact on brand favorability when the news itself is deemed “heavy” by viewers. The study also found that news content is so uniquely valued that brands running in news are perceived as trustworthy and providing more valuable information than when they appear in non-news content.

Detailed key findings of the study include:

  • News content is uniquely valued, and ads benefit from the positive halo: People found news content more valuable, trustworthy and interesting; and as a result, ads in news felt +8% more relevant, +6% more valuable, and +4% more trustworthy, compared to non-news content.
  • News perceived as ‘heavy’ isn’t bad for brands, instead it drives brand impact: Brand favorability was up +7% and intent to recommend advertised brand was up +5% from ads in news perceived as heavy by participants.
  • Credibility of the news source matters – especially to the affluent: 57% of respondents feel that brands should vet the news source before advertising. This was especially true for more affluent households, those with incomes $100K+ (61%), versus those with incomes of $35K or less (52%).
  • The news source a brand runs its ad on matters more than the news content itself: Ads on a high-quality, trusted and well-respected news source led to increased brand favorability (+21%), research intent (+25%), and purchase intent (+21%).
  • Ad message is key when advertising in different types of news: In hard news, a more direct, product focused ad message led to higher brand impact, with favorability up +10%, research intent up +5% and purchase intent up +7%. Conversely, in race and culture news, a storytelling approach worked better for elevating favorability (+11%) and purchase intent (+10%).

 
“An important insight from the study is how passionate people feel about the news source that a brand advertises on, and the reliability of that source is a key driver of purchase intent,” said Joshua Lowcock, Chief Digital Officer, UM, and Global Brand Safety Officer, IPG Mediabrands. “Brands should support quality journalism if they want to maximize the effectiveness of their ad spend. It recognizes that credible and trusted news websites are not a brand safety risk and that where you place your ad matters.”
 
“The diversified storytelling that news provides —from local community coverage, to pop culture, to international affairs— is where the opportunity lies. We’re proud to release this in-depth report, in collaboration with MAGNA, to demonstrate the impact of advertising within this format,” said Asaf Davidov, VP Measurement & Insights for Disney Advertising Sales. “These insights confirm that consumers associate ads seen in news with being trustworthy and valuable. Which offers brands the opportunity to tailor their message to the audience.”
 
The study recruited participants from a nationally representative panel, where they were randomized to a brand’s ad or a control ad. Participants watched a video or viewed an article of their choice on their assigned platform. Appropriate ads were served based on test or control groups. A post-exposure survey was conducted to measure impact on traditional branding metrics and to obtain qualitative feedback. The variables tested were across content genres, news genres, platforms, ad formats, brand verticals and creative strategies.
 

The full study can be found here.

 
About Disney Ad Sales:
Disney Ad Sales is responsible for advertising sales and integrated marketing for The Walt Disney Company’s entertainment and sports offerings through linear, digital, social, audio and ad-supported streaming businesses. This includes ABC, ABC News, Disney Channels Worldwide, Disney Digital, ESPN Networks, ESPN+, Freeform, FX, National Geographic, Hulu, and its eight ABC-owned local stations.

About MAGNA:
MAGNA is the leading global media investment and intelligence company. Our trusted insights, proprietary trials offerings, industry-leading negotiation and unparalleled consultative solutions deliver an actionable marketplace advantage for our clients and subscribers.

We are a team of experts driven by results, integrity and inquisitiveness. We operate across five key competencies, supporting clients and cross-functional teams through partnership, education, accountability, connectivity and enablement. For more information, please visit our website: https://magnaglobal.com/ and follow us on LinkedIn and Twitter.

Media Contact:
Zinnia Gill
Mediabrands
Director, Global Corporate Communications
(646) 965-4271
[email protected]