Drinks industry drives 20% growth in advertising market

Ireland’s advertising market grew by 20 per cent last year, with the highest level of growth recorded in the drinks industry, according to a new report.

The report by GroupM Ireland, a media investment company, also predicts growth of 9 per cent in the Irish advertising market this year. This follows a decline of 6 per cent in 2020 due to the effects of the coronavirus pandemic.

GroupM credits the growth in the Irish market partly to the State’s “resilience and resourcefulness”, which is enabling it to emerge from the pandemic in a position of relative strength.

The domestic growth rate is closely aligned with GroupM’s projection for global advertising growth of 22.5 per cent in 2021 and 9.7 per cent in 2022.

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The sector which saw the highest level of growth in advertising spend in Ireland in 2021 was the drinks industry (both alcoholic and soft drinks), which saw an increase of 80 per cent.

This was driven by a focus on the in-home trade for both alcoholic and soft drinks brands as well, as a pivot to supporting non-alcoholic variants in response to tightened advertising guidelines.

Other traditional high-spend categories, such as household services, finance and government, social and political organisations retained similar market share by maintaining the high levels of advertising seen throughout 2020.

GroupM is expecting to see lower levels of growth in 2022, but continued consistency in the top four spending categories of retail, household services, finance and government, social and political.

It expects the highest year-on-year shifts to come from entertainment and media, travel and transport and possibly motors.

Digital market

At a rate of 23 per cent, spending on digital advertising grew at a greater pace than the rest of the industry. It now accounts for 60 per cent of Irish advertising spending, up from 58 per cent last year. The report predicts this will rise to 62 per cent of market share in 2022.

GroupM credits this growth to the continued expansion of the app ecosystem, increasing consumer adoption of ecommerce and the growing role of cross-border media marketplaces. Search advertising also outperformed the average growth rate for digital.

Digital advertising has grown at an even faster rate on a global basis, now accounting for 64.4 per cent of market share, up from 60.5 per cent in 2020.

GroupM estimates that Meta/Facebook, Alphabet/Google and Amazon accounted for between 80-90 per cent of the global total.

Television advertising spend grew by 16 per cent domestically in 2021 (compared with 11.7 per cent globally), accounting for an 18 per cent market share, while radio grew by 12 per cent and accounted for a 9 per cent market share.

Print advertising

Print titles temporarily halted previous declines, with newspaper advertising rebounding by 15 per cent due to a strong digital-first bounce back from smaller-scale, local advertisers.

Newspapers accounted for an 8 per cent market share in 2021 and magazines accounted for 1 per cent. Newspaper advertising is expected to fall by 8 per cent in 2022 and will account for 7 per cent market share next year, according to the report.

Outdoor advertising experienced growth of 19 per cent in spending, in recovery from an exceptionally low base, and is expected to grow by a further 27 per cent in 2022, outpacing the international growth rate for outdoor of 17.1 per cent in 2021 and 6.4 per cent in 2022.

Cinema advertising only partially recovered this year, but is expected to grow by close to 90 per cent in 2022.