Market researchers give good prospects for performance marketing
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German market for display advertising will grow faster than expected in 2020
The online marketing group (OVK) of the Federal Association of the Digital Economy (BVDW) forecasts growth in net sales from digital display advertising of 8.6 percent to EUR 3.92 billion in 2020. As Thomas Duhr, Vice President of the BVDW, reported today at DMEXCO, the BVDW had assumed growth of 7 percent before the outbreak of the corona virus. The market is developing better than expected despite the pandemic.
In fact, the lead over the forecasts in the first quarter was even greater: With growth of 12 percent year-on-year, the market got off to an excellent start. But then came the pandemic. The reach then increased significantly, especially in the months of March, April and May, as customers were increasingly online. However, many advertisers did not take this opportunity and reduced their advertising budgets due to uncertainty. As a result, the costs (TCPs) for digital advertising have also fallen noticeably. But growth also almost completely disappeared in the second quarter.
However, sales recovered as early as the third quarter and already reached the pre-corona level again. The OKV attributes this to the increased use of digital media and the short-term controllability of digital advertising. Rasmus Giese, Chairman of the OVK, says: “Advertisers are shifting their budgets significantly to digital channels. Certainly also because the corona pandemic has further increased the spread and use of digital media.”
In 2021, marketing decision-makers will primarily focus on performance marketing
On behalf of DMEXCO, the market research company Civey asked 500 marketing decision-makers what strategy they were planning for the coming year 2021. The results speak for performance marketing: 37 percent will invest more advertising money in search engines and social media. SEA, SEO and Facebook Ads in particular, but also more specific platforms such as LinkedIn Ads and co. benefit. Audio and video platforms such as YouTube can look forward to more money from 23 percent of those surveyed.
The losers in the survey, on the other hand, are classic channels such as print and TV, which will have to be content with falling advertising budgets. However, due to the current economic uncertainties, advertising budgets will tend to fall slightly in the coming year: while 18 percent of those surveyed plan to spend more money, 25 percent said they would likely reduce their budget. However, 40 percent will not spend more money on any advertising channel than this year. But: 45 percent have not yet finally planned their budgets for 2021. It remains to be seen how these numbers will change in the last quarter of 2020, especially with a view to Black Friday and the holiday season.
