More than £1 billion was taken out of traditional advertising expenditure during the UK’s lockdown period, according to new data from Nielsen which finds that between March 23 and June 30 there was a 48% year-on-year drop in spend.
Some big advertisers slashed their expenditure, most notably McDonald’s (-97%). That’s understandable when stores weren’t open, but even among those brands with relevant offerings there was no obvious pattern.
The latest Nielsen AdIntel data shows that while Sky (-60%) and Amazon (-77%) cut their spending sharply, Disney+ (+962%), O2 (+65%) and Microsoft (+142%) increased theirs. In the FMCG category, Procter & Gamble cut spend by £9.9 million while competitor Unilever increased spend by £3.5 million.
“There was no guidebook on how to navigate advertising during the lockdown period, with customers restricted to home environments and an unclear exit strategy,” said Barney Farmer, UK Commercial Director at Nielsen. “As a result, we have seen varying approaches to advertising, with some increasing spend while the majority cut back.”
Those categories with the largest cuts in ad spend were entertainment and leisure (-£207m) and travel and transport (-£138m) with both industries suffering immediate revenue loss due to lockdown restrictions.
Similarly, OOH advertising took a significant hit, as advertisers cut spend in response to lockdown when high footfall areas became deserted. Although spend on OOH almost doubled from £14m in May to £25m in June as restrictions eased, this was still well below normal levels.
“Those businesses that have adapted and responded to the increase in online purchase behaviour have welcomed new audiences,” Patrick Johnson, CEO and Chairman of Hybrid Theory, told WARC. “It is unlikely that many will completely return to their pre-lockdown marketing strategies having been immersed in new digital tactics.”
He expects to see brands such as Disney and eBay continue spending their dollars based on the success they’ve already seen. But, he added, “it emphasizes the fact that media is not about spending more, but smarter. It will be critical to understand who is in market for products and services to reduce ad wastage and improve campaign performance.”
The single biggest spender during this period was Public Health England; the £43 million it spent to encourage lockdown compliance and raise awareness of best health practices represented a yearly increase of 5,037%. This “reflects the importance of advertising as a communication platform for any public or private body,” Farmer added.
And it’s a theme echoed by Advertising Association president Keith Weed: writing for WARC he notes that the Government’s ‘Enjoy Summer Safely’ campaign “again highlights that when you need to share a message, you turn to advertising”.
Sourced from Nielsen; additional content by WARC staff