MAGNA GLOBAL ADVERTISING FORECASTS – JUNE 2021

GLOBAL ECONOMIC RECOVERY BRINGS RECORD AD MARKET GROWTH

KEY FINDINGS

  • Global advertising spending will grow by $78bn in 2021 (+14%) to $657 billion, a new all-time high, following a decline of -2.5% in 2020. The marketplace will continue to grow in 2022 (+7%).
  • Advertising activity is fueled by (1) economic recovery (global GDP +6.4%) benefitting key ad-spending verticals severely hit by COVID-19 last year (automotive, travel, entertainment, restaurants), (2) stronger-than-ever organic drivers to digital marketing, and (3) international sports events (Tokyo Olympics, UEFA Euro).
  • Digital ad formats capture most of the growth with ad sales up +20% to $419bn, 64% of total ad sales.
  • Linear ad sales are slower to recover but will stabilize full-year (+3% to $238bn).
  • All 70 ad markets monitored will expand again this year with China (+16%) and the UK (+17%) among the largest increases.
  • The US market will grow by $34bn (+15%, strongest growth rate in 40 years) to reach $259 billion, with digital ad sales up +20% and non-political linear ad sales up +4%.
  • Linear ad sales still represent the bulk of ad revenues for traditional media owners and their continued stagnation will trigger a wave of consolidation in the media industry, aimed at competing with digital media players.

 

According to Vincent Létang, EVP, Global Market Research at MAGNA and author of the report: “As economic recovery is stronger and faster than anticipated in several of the world’s largest ad markets (US, UK and China, in particular) and consumption accelerates, brands need to reconnect with consumers. At the same time, the acceleration in ecommerce and digital marketing adoption that started during COVID, continues full speed into 2021, fueling digital advertising spending from consumer brands as well as small and DTC businesses. This unique combination of cyclical, organic and structural drivers will lead to the strongest advertising annual growth ever monitored by MAGNA: +14% globally (+15% in the US).”

GLOBAL AD MARKET: +14% TO $657 BILLION

As the economy recovers faster than expected globally (GDP +6%) and in most markets, so do marketing activity and advertising spending. With the added driver of rescheduled international sports events, MAGNA forecasts global all-media advertising spending to grow by $78bn (+14%) to $657bn in 2021, a new all-time high. MAGNA also raises its forecast for advertising market growth in 2022 to +6.6% (previously +5%). The +14% growth expectation for 2021 would represent the highest growth rate on record, beating +12.5% in 2000, and a significant increase from MAGNA’s previous global forecast (Dec. 2020: +8%).

Economic recovery will lift all boats, but the contrast has never been wider between digital ad sales accelerating (+20% to $419bn) and linear ad sales (linear TV, linear radio, print, OOH, cinema) which are barely stabilizing (+3% to $238bn after 2020’s -18% decline). COVID may be receding in most markets but the changes to lifestyles, media consumption and business models continue to fuel an acceleration in the adoption of digital marketing from both national consumer brands and small, local and “direct” businesses. Digital growth from consumer brands comes partly at the expense of traditional linear channels but in the case of small businesses (that represent the bulk of search and social ad spend), it is mostly incremental to the advertising pie.

All of the 70 ad markets monitored by MAGNA will grow to some degree in 2021 and 2022. In 2021, Asia Pacific ad markets will grow by +13%, EMEA markets by +12%. Latin America and North America will both grow by nearly +15%. Everywhere, the pattern is similar, with linear ad sales to grow by low- to mid-single digits and digital ad sales growing by +20% or more. The United States remains the largest market and will increase by +15% in 2021, and will still remain ahead of China (+16%), Japan (+9%), the United Kingdom (+17%) and Germany (+11%) among the top five markets.

Nearly all digital ad formats will grow by double-digits in 2021 as total digital ad sales will account for 64% of global all-media ad spend. They will reach two-thirds of all advertising sales in 2022. The explosion of ecommerce will boost search by +20% to $200 billion, while growing marketing adoption and media consumption will drive social media by +26% to $119 billion. Video ads will grow by +24% to $57 billion as short-form, long-form AVOD and OTT ad spend are all fueled by increased reach and viewing. Out-stream video and static banners may grow at a more subdued pace (single-digits) due to the increasing limitations to tracking and targeting on websites (on Safari and soon Chrome) and apps (on iOS14).

Among linear ad formats, MAGNA expects linear television ad sales to recover as consumer brands (e.g. automotive, drinks) compete for returning consumers in a brand-safe environment. Advertiser demand will drive CPM inflation (average +8%) which offsets eroding ratings. In addition, international sports events bring additional ad budgets: Global TV ad sales will thus grow by +3% to $153 billion. Radio and out-of-home media will benefit from businesses re-opening in several key verticals (e.g. automotive, retail, entertainment) as well as a gradual return to consumer mobility that will restore their audiences; ad sales will increase by +5% and +10% respectively. Print ad sales will not quite stabilize as the return of key verticals (fashion, beauty, travel) will not offset the continued decline in circulation and ad pages. Newspaper and magazine ad sales will decrease by -4% and -5% respectively.

The scale reached by digital media owners and the stagnation of linear ad spend is forcing traditional media owners to consolidate to compete more effectively and invest in cross-media technology. MAGNA believes the spring announcements in the US (Warner/Discovery) and in France (TF1/M6 with a combined market share of 85%) are just the beginning of a new wave of mergers and acquisitions globally.

US AD MARKET: +15% TO $259 BILLION

In the US, media companies’ net advertising revenues (NAR) will reach a new all-time high of $259 billion in 2021. That will be an increase of $34 billion (+15%) over 2020. The +15% growth will mostly be driven by digital advertising acceleration (+24%) while linear ad sales will only show modest growth (+4% excluding political). The new growth forecast represents the strongest acceleration in 40 years and stands nine percentage points above the previous MAGNA forecast (published March 2021). The upward revision comes from a better-than-expected start of the year and an increasingly strong economic outlook for the coming months: For example, the International Monetary Fund (IMF) recently increased its full-year, real GDP forecast to +6.4%. Marketing activity and advertising spending will be fueled by strong consumption, a fast-recovering job market, the reopening of many businesses (restaurants, theaters, amusement parks…) and the return of normal events and sports schedules, plus the Olympics.

Following a strong 1Q21 (+16%, driven by huge digital growth), MAGNA expects second quarter ad sales to grow by at least +35% year-over-year (YOY), against a historically low quarter in 2Q20 (-17%). Strong YOY growth will continue in 3Q21: +13% with $900m of incremental ad spend generated around the Tokyo Olympics. Growth will slow down to +4% in 4Q21, which compares against a strong quarter in 4Q20 that was boosted by record political spending and a robust holiday season.

Digital advertising sales will grow by +24% to reach $179bn, to approach 70% of total ad sales. Unlike linear media, the digital market quickly rebounded from its lows in the second quarter of 2020, and it has been red hot ever since. First-quarter digital ad sales were up +35% YOY and the second quarter is expected to grow by at least +40% YOY.

Within digital media, social, video and search will drive growth. Both social media and digital video will grow +28% this year, while search will gain +23%. Video will be driven by the short-form segment, as both YouTube and Twitch continue to report strong results, and the long-form segment, as the proliferation of AVOD platforms in 2020 (Peacock, Paramount+, etc.) demonstrate, will capture dollars lost in linear TV. Digital audio will also grow in 2021 (+17%) as consumption and marketing usage in podcasts continues to increase rapidly.

Non-political linear advertising sales (linear TV, radio, print, out-of-home and cinema) will increase by +4% to $81 billion, but due to the lack of political spend this year, total linear ad sales (including political) will be merely stable. Linear ad spend has been slow to recover in 1Q21 and ad sales were still down vs 2020 (-11% YOY), but more easily, the return of sports, and consumer mobility will help stabilize the market in the next three quarters. Within linear media, out of home will show the highest growth, +11% over 2020, following a heavy decline in 2020 (-25%) and in 1Q21 (-28%), as mobility recovers and advertising spending comes back from entertainment, retail and travel (all among top 5 spending verticals). Local TV will benefit from the recovery of its No. 1 industry vertical, automotive (Jan-April car sales up 29%), driving non-political ad sales by +10%. Radio ad sales will increase by +7% to $10bn, thanks to automotive and entertainment verticals (both in the Top 4 radio verticals). Print is the only linear ad format that will not grow again in 2021 (-14%), though national newspapers and magazines will fare better than their local counterparts. National TV ad sales will grow by 5% to $38 billion helped by stronger pricing and incremental spending around the Tokyo Olympics.

Traditional media owners’ cross-platform ad sales (linear+digital) will grow by +5% in 2021, with total television ad revenues up +6% (including long-form AVOD +25%) and audio ad sales up +10% (including audio streaming and podcasting up +35%). The digital ad sales of newspaper and magazine publishers, which now stand at half of total publishing ad sales, will grow further this year (+14%) but not enough to offset the continuing decline of print ad sales (total ad revenues -14%).

In 2022, MAGNA expects the US advertising market to grow by +8% to reach $280bn, thanks to continued economic growth (GDP growth between +3.5% and +4.3%) and more cyclical drivers (Winter Olympics in 1Q22, mid-term elections in 4Q22). Marketing and advertising activity will also benefit from a full year of an open economy compared to 2021, when the first quarter was still partly hampered by COVID. This is a two-percentage point upward revision from MAGNA’s previous report in March.

MAGNA believes the recent merger announcement between Warner Media and Discovery is the first of a new wave of consolidations to come in the media industry. Facing stagnation in linear media consumption and linear ad sales that are still the bulk of their business revenues, traditional media companies have no choice but to grow in scale, in order to compete with digital media giants, and invest in cross-platform advertising solutions. Traditional media owners are moving now as they believe antitrust authorities are ready to consider market shares in the broader media market and thus approve horizontal consolidations that would have been unthinkable just five years ago. The US TV market remains relatively fragmented following the merger of Warner and Discovery: The top three TV ad vendors (currently NBC, ViacomCBS and Warner/Discovery) will control just 60% of the US TV advertising market, compared to 90%+ for the top three broadcasters in most other advanced markets. Moreover, they will control only 15% of the broader, cross-platform ad market compared to 30% for Google or 16% for Facebook. Media consolidation is global, and international markets remain a step ahead as the top two French broadcasters (combined market share 90%) just announced their own merger plans.

  • DOWNLOAD full MAGNA reports and datasets: WWW.ATLAS.MAGNAGLOBAL.COM (Mediabrands employees and MAGNA subscribers)
  • NEXT UPDATE: September 2021 (US), December 2021 (US & Global)

TABLE 1: GLOBAL NET AD REVENUES (NEW GROWTH FORECASTS)

KEY MARKETS                     2020         2021           2022

WORLD                                 -2.6%         13.5%        6.6%

NORTH AMERICA               0.2%         14.9%         7.9%

LATIN AMERICA              -11.5%        14.8%         5.8%

WESTERN EUROPE          -5.0%        12.4%         5.9%

CENTRAL &                          -3.4%       11.6%          5.1%

EASTERN EUROPE

EMEA                                     -5.0%       12.0%            5.9%

APAC                                      -3.3%        12.8%            5.5%

AUSTRALIA                         -5.1%        11.4%              2.9%

BRAZIL                                  -6.8%       15.2%             6.9%

CANADA                               -5.8%        11.4%              5.7%

CHINA                                     2.6%         16.1%              5.9%

FRANCE                                -6.0%         13.1%              7.2%

GERMANY                            -3.7%          10.9%             5.0%

INDIA                                     -22.8%        11.0%              13.6%

ITALY                                      -10.4%        7.7%                4.0%

JAPAN                                      -6.0%          8.8%                4.9%

RUSSIA                                     -1.8%          11.6%               4.9%

SPAIN                                       -10.7%         15.2%               7.5%

UNITED KINGDOM             -2.6%          16.8%                8.0%

USA (EXCL. CE)                     -1.7%            17.4%               6.5%

USA (INCL. CE)                        0.5%            15.1%                8.0%

Source: MAGNA, June 2021

TABLE 2: NET AD REVENUES IN KEY MARKETS (NEW vs OLD FORECAST)

2021 Growth                              Fall 2020              Spring 2021             Change

World (all media)                         7.6%                          13.5%                     5.9%

North America                               4.2%                           14.9%                    10.8%

Latin America                                 8.3%                            14.8%                     6.6%

Western Europe                              9.1%                            12.4%                      3.3%

Central and Eastern Europe       9.5%                            11.6%                      2.1%

Emerging                                            11.2%                            14.4%                     3.2%

Developed                                           6.4%                             13.2%                      6.9%

Europe, Middle East, Africa         8.9%                             12.0%                      3.1%

Asia Pacific                                          11.1%                               12.8%                     1.7%

Total Linear                                          3.5%                               3.1%                    -0.4%

Total Digital                                        10.4%                               20.4%                  10.0%

Source: MAGNA, June 2021

TABLE 3: NET ADVERTISING REVENUES – US MARKET

AD FORMATS                                       2020                              2021                             2022

DIGITAL AD REVENUES                  13.3%                            23.5%                         11.1%

Search                                                       11.6%                             23.2%                       11.4%

Online Video                                           23.5%                            28.1%                      15.8%

Social Media                                            21.4%                             28.3%                    12.6%

Mobile                                                        20.4%                             16.1%                    15.2%

LINEAR AD REVENUES (incl. CE) -16.4%                            -0.1%                     1.2%

National TV (incl. CE)                         -11.8%                                5.1%                   -3.7%

National TV (excl. CE)                          -12.3%                              3.6%                  -3.6%

Local TV (incl. CE)                                     0.8%                             -11.0%                 15.1%

Local TV (excl. CE)                                    -18.7%                            9.9%               -4.4%

Print                                                                -31.6%                           -13.9%           -16.7%

Radio                                                                -31.0%                             6.0%               3.6%

Out-of-home                                                -24.6%                            10.4%             8.2%

Cinema                                                              -79.9%                            135.9%       50.0%

Direct Mail                                                       -13.6%                            -4.0%         -0.7%

GRAND TOTAL (incl. CE)                              0.5%                               15.1%          8.0%

GRAND TOTAL (excl. CE)                              -1.7%                              17.4%          6.5%

Source: MAGNA, June 2021

ABOUT THE RESEARCH

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 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://www-wp-stage.magnaglobal.com/ and follow us on LinkedIn and Twitter.
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 forecasting@magnaglobal.com.

TO EFFECTIVELY REACH PEOPLE WITH DISABILITIES, BRANDS MUST PRIORITIZE ACCESSIBILITY AND INCLUSIVITY ACCORDING TO NEW STUDY BY CURRENT GLOBAL, MAGNA & IPG MEDIA LAB

Current Global with the Public Relations & Communications Association Release Industry Guidelines  

New York, NY – April 21, 2021 – People with disabilities, representing 15 percent of the global population, regularly consume all types of content, but are they able to fully access that content comfortably? A new study by Current Global, MAGNA and the IPG Media Lab, “Digital Accessibility: The Necessity of Inclusion,” answers this question and more by revealing that brands must prioritize accessibility and inclusivity in communications planning – it’s no longer a “nice to have.”

With a collective global buying power of $8 trillion, this community represents a significant audience for marketers to exclude by default or design:

  • 285 million people are visually impaired; 39 million are blind and 82 percent of all blind people are age 50+.
  • 466 million people have disabling hearing loss; by 2050, that number will rise to over 900 million.
  • Between 1-3% of the population has an intellectual disability, as many as 200 million people; intellectual disability is significantly more common in low-income countries – about 16 in every 1,000 people.
  • About 18.5 million people have a speech, voice, or language disorder.

 

“Content is published every day that’s inaccessible to many, but it doesn’t have to be that way,” said George Coleman, Co-CEO of Current Global. The agency made an industry-first commitment in December 2020 that every piece of communication developed, curated or published on behalf of the firm and its clients will meet the highest accessibility standards. “If brands don’t adjust their communications strategies to reach all audiences, they will miss out on forging long-lasting relationships with a large population of consumers,” he added.

Study participants had visual, hearing, cognitive, or speech disabilities. The findings show that people with all types of disabilities consume many forms of media, yet have trouble accessing content comfortably and with ease, even when using assistive tools. Understanding the lived experiences of people with disabilities clearly shows assistive tools don’t always work, with the content itself being half the problem. In addition, the study found that accessibility in communications has a direct impact on how people feel about a brand.

  • People with disabilities are regularly consuming all forms of content weekly or more often, particularly visual content (98%): Social media, TV shows and short video clips are favored by survey participants (89%, 86%, and 80% respectively).
  • Social media platforms are comparatively difficult to use: No matter the type of disability, people find social media somewhat difficult or very difficult to use (visual: 22%; hearing: 17%; cognitive: 23%; speech: 27%). Some of the problems reported include small text, misleading buttons, ads interfering with actual posts, far too many options and menus, and hard to navigate.
  • Assistive tools are a flawed experience: 54% of respondents, regardless of disability, use an assistive tool to help read, view, or listen to content; 64% of those who use an assistive tool reported having problems consuming content even with an assistive tool and 34% have problems consuming content because of the tool itself. Moreover, 56% of the overall audience needs assistive tools, but don’t have access to them – citing cost as a major issue.
  • Lack of accessibility has become a normalized experience: On the surface, people think brands are doing a good job (40%), but standards are low to begin with; the study found that people with disabilities were not sure what changes companies should make.
  • Inaccessible communications cause negative emotions and can have serious repercussions for brands: 81% reported a negative emotional response when a brand’s communication was inaccessible, with 38% also feeling frustrated. When brands are accessible, they reap a host of benefits, with 60% taking a positive brand action and 81% having a positive emotional response and feeling connected to the brand.

 

“It’s astounding how much work still needs to be done to make communications accessible to people with disabilities,” said Kara Manatt, SVP, Intelligence Solutions, MAGNA. “This audience is consuming a lot of content, so brands need to ensure they put in the work to make communications more accessible. Assistive tools are only part of the solution – if communications aren’t accessible, the tools can’t really be effective.”

The full “Digital Accessibility: The Necessity of Inclusion” study, which queried over 800 people from the United States and United Kingdom, can be found below.

Download the full report 

 

New Guidelines Designed to Make Communications Accessible to All

Current Global worked with the Public Relations & Communications Association (PRCA) to publish the PRCA’s Accessible Communications Guidelines, also in partnership with the PR Council. The free guidelines detail the tools available to agencies and in-house teams and the standards and processes they should apply to make their content as inclusive as possible.

Download the PRCA guidelines

 

“As professional communicators, it is incumbent on us to make communications inclusive for people of all abilities so we can reach every member of society,” said Francis Ingham, Director General, PRCA and Chief Executive, ICCO. “The technology and tools to help us do this are readily available, so the key priority is to update the way we work to adhere to best practices laid out in the guidelines.”

To supplement the research and guidelines, Current Global created a website to inspire, inform, and instigate change across the industry. The site will feature relevant research, news, best practices, cases studies, and an accessibility commitment that organizations can sign to show their intent to develop, curate or publish communications that will meet the highest accessibility standards.

About Current Global:

Current Global is part of IPG’s (NYSE: IPG) DXTRA unit and its portfolio of public relations and communications firms. A midsized global agency with a full-service offering, our team of inquisitive, insightful, and imaginative people mix scientific rigor with creativity to get to the very core of how communications can drive outcomes. Our heritage is a deep understanding of earned media, but we are equally adept at developing integrated campaigns that encompass paid, owned, and social. Discover how we help clients Own the Moment at www.currentglobal.com.

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://www-wp-stage.magnaglobal.com/ and follow us on LinkedIn and Twitter.

About IPG Media Lab:

Part of the Interpublic network, the IPG Media Lab identifies and researches innovations and trends that will change the media landscape and how brands engage with their audiences. Since 2006, the Lab has worked with our clients and with industry partners who can help them best adapt to disruptive change. Its expertise, resources and consulting services also help to inform the learnings, strategies, and business outcomes of all Interpublic agencies. For more information, please visit www.ipglab.com or follow @ipglab.

 

Media Contact:

Zinnia Gill

Mediabrands

Director, Global Corporate Communications

(646) 965-4271

zinnia.gill@mbww.com

 

Does every second *really* count?

Snapchat partnered with MAGNA and the IPG Media Lab on a joint research study to dispel the myth that 6-second ads aren’t as effective as traditional 15-second spots.
The research1 showed that on Snapchat, shorter ads persuaded more consumers to consider purchasing the products featured in the commercials compared to 15-second ads. We wanted to highlight key learnings from this research as well as offer additional best practices for how advertisers can plan their video buys on Snap.
To evaluate video performance across devices, platforms and ad lengths, MAGNA leveraged a digital-laboratory-based experimental design. They recruited over 7,770 participants from a representative panel on both PC and mobile devices. Panelists’ media habits were evaluated to assign them to a platform: either Snapchat, a video aggregator, or a full-episode player (FEP). Participants were asked to select content to watch during a controlled experience that looked like the real thing while ads were served during the standard intervals in which they would typically appear native to that platform. However, MAGNA was able to control which ads were served to ensure proper randomization and allow for the same brands and creatives to be tested across platforms. All behaviors were tracked and, after the media experience, participants were asked to complete an online survey measuring branding metrics including ad awareness, brand perception, and purchase intent. A diverse group of brands from varying industries with different target audiences were included in this experiment: MINI, Clinique, LEGO, and a major CPG brand.

Regardless of length, full-screen vertical ads on Snapchat drove more than 2x the lift in awareness than other platforms tested.

On Snap, 6-second ads were more persuasive than 15-second ads for both younger and older generations.

This is because shorter ad lengths recorded highly positive perceptions that were equal among both younger and older generations. When 6-second ads were viewed on Snap, the majority of participants considered the ads immersive, innovative, and represented the brand well.

Interestingly, younger people are LESS likely to feel that 15-second ads are “innovative” and “offer new info.”

Shorter-length Snapchat ads were also more persuasive than either lengths tested on other platforms.

15-second ads are still valuable — they increase awareness of new products.
We found that of the ads tested, the ads that marketed a new product saw longer lengths provided greater efficacy on Snapchat. Therefore, new product launches should be a time to consider Extended Play Commercials in your media mix.
Lastly, we wanted to gauge the incrementality we could offer by developing creative custom for Snap, rather than cutting down from longer-length assets.
What we discovered is that creative significantly embodies Snapchat’s creative best practices. Cut-downs and customized creative performed similarly and, when we looked at persuasion across all ads tested, the delta was consistent for the two separate creative executions.

Takeaways for Advertisers

  • Plan for objectives — not length Length is not a predictor of ad efficacy. Instead, consider differences among devices and media channels as a way to optimize media budgets and still achieve your objectives. Snapchat was shown to be more effective at improving both awareness and purchase intent than the OLV platforms tested. Leverage campaign measurement to align on which media channels and selections are able to achieve your specific objectives.
  • Activate commercials on Snapchat to drive persuasion  Regardless of age, 6-second ads were shown to be persuasive on Snapchat.
  • When introducing new products, consider Extended Play Commercials on Snapchat. 
  • Custom creative isn’t necessary, as long as creatives incorporate Snap’s best practices.
    Read the full report
    Download the planning handbook

NEW STUDY BY MAGNA AND IPG MEDIA LAB REVEALS PLANNED SEQUENCING OF VIDEO AD LENGTHS CAN DRIVE 2X HIGHER PURCHASE INTENT

Study Highlights Best Uses of Ad Sequencing to Drive Brand KPIs and Save Impressions

 

NEW YORK – February 27, 2021 – Marketers have long created multiple video ad lengths but with more innovative technology, we now have the ability to deliver those ads in a desired sequence. A new study by MAGNA and IPG Media Lab, “Ad Sequencing: From Exposure to Storytelling,” uncovers the key to determining the desired ad sequencing brands should use to make a good first impression and convert customers fast. The study explores the impact of ad sequencing and finds the key to a successful brand story when delivering more complex messaging is to make the most of the first impression by communicating more up front. The study also found that using short ads as a primer for creative that’s not complex (e.g. brand imagery-focused) and maximizing variation in ad lengths across exposures is key to a successful marketing strategy.

The study tested video ad lengths, sequence of ad lengths, frequency of exposure and focused on three brands spanning Apparel, Auto and Consumer Electronics. In total, 201 ad scenarios were tested. Experimental design was used by randomizing YouTube users into test and control groups, with ad exposures taking place over the course of 5 days.

“Being thoughtful about the sequence brand messages are delivered in can not only amplify the impact on important brand metrics, but also allows advertisers to achieve more with fewer impressions,” said Kara Manatt, SVP, Intelligence Solutions, MAGNA. “To plan appropriately, we realized that the complexity of the message plays a key role, and that when in doubt, maximize the variation in ad lengths across exposures”.

Additional key findings of the study include:

  • Sequence Matters. Serving video ads in the best order for a given campaign can result in 2X the impact on purchase intent. The particular sequence that works best for each campaign is ultimately driven by the complexity of the messaging and not by the consideration level of the industry vertical.
  • Messaging Content Matters. Ads with complex messaging, for both low and high consideration categories, should make the most of the first impression by communicating more information in this crucial touchpoint. When messaging is less complex and instead focused on imagery, on the other hand, using short ads to prime audiences work best.
  • Ad Sequencing Curbs Ad Skipping. Ad skipping, which is often seen as an ingrained behavior by consumers, can be curbed by a more effective sequence of ad exposures.
  • Less is More with the Right Sequence. For many traditional brand KPIs, brands were able to achieve the same brand lift with fewer exposures by starting off with the right sequence.

 

Read the U.S. report

Read the Australian report

 

 

About MAGNA

MAGNA is the centralized IPG Mediabrands resource that provides strategic investment and media intelligence for agency teams and clients. We utilize our insights, forecasts and strategic relationships to provide clients with a competitive marketplace advantage.

MAGNA harnesses the aggregate power of all IPG media investments to develop go-to-market strategies, designing unique partnerships to drive maximum value for our clients. MAGNA has set the industry standard for more than 60 years by predicting the future of media value. We publish more than 40 annual reports on audience trends, media spend and market demand as well as ad effectiveness.

MAGNA infuses the organization with knowledge that empowers better decision-making. We are a team of experts across five key competencies who support IPG cross-functional teams through: Partnership, Enablement, Accountability and Connectivity. Follow us on Twitter @MAGNAGLOBAL.

 

About IPG Media Lab

Part of the Interpublic network, the IPG Media Lab identifies and researches innovations and trends that will change the media landscape and how brands engage with their audiences. Since 2006, the Lab has worked with our clients and with industry partners who can help them best adapt to disruptive change. Its expertise, resources and consulting services also help to inform the learnings, strategies and business outcomes of all Interpublic agencies. For more information, please visit www.ipglab.com or follow @ipglab.

 

 

Media Contact:

Zinnia Gill

Mediabrands

Director, Global Corporate Communications

(646) 965-4271

zinnia.gill@mbww.com

 

 

 

DO 6-SECOND ADS WORK?

A new study says they do, at least on video sites where longer ads are skippable

 

By Garett Sloane. Published by Ad Age on 10 December 2020.

 

IPG Media Lab and Magna helped Snapchat study the effectiveness of shorter ads.

When it comes to ad lengths, size doesn’t matter. In fact, six-second ads carry as much punch as 15-second ads, if not more, according to a new study that could benefit Snapchat.

The study, from IPG Media Lab and Magna, was released this week and tests the short-video format, which has proliferated online. Snapchat, YouTube, Facebook and Twitter all have some version of a 6-second spot, but the format has typically been considered an after-thought for creatives working on major campaigns.

Kara Manatt, SVP of intelligence and solutions at Magna, says that the six-second spot has finally come into its own though. The research showed that shorter ads persuaded more consumers to consider purchasing the products in the commercials than 15-second ads, particularly on Snapchat. The social media app cooperated with IPG Media Lab and Magna on the study.

“What we found was that shorter ads actually are much more effective than they used to be,” Manatt says. “We actually see a lot of persuasion happening.”

The study will be sure to meet some skepticism among advertising purists, with creatives at agencies still very much committed to longer ads with more cinematic qualities. TV networks have tried to adopt the six-second ad, too, but it’s still mostly found in social media and internet video sites.

Six-second ads have mostly been used as secondary components in campaigns, and are typically just shorter cuts of longer ads. But they perform better when they are conceived with the brevity baked into the concept, Manatt says.

Snapchat developed the six-second ad in 2018 as a way to offer an unskippable ad that was still short enough to pacify impatient viewers. For years, digital platforms have tried to prove that six seconds could offer a new kind of creative canvas for brands while also managing to satisfy the audience, which has been known to skip ads quickly when the option is there. “Consumers really like short ads right,” Manatt says.

Snapchat runs six-second commercials in its media section, which showcases high-production video programming from partners like BuzzFeed, Vice, Vox, CNN and others. Last quarter, Snapchat had its best performance yet selling ads with $679 million in revenue, an increase of 52 percent year over year.

“We’ve seen that shorter ad lengths, like our non-skip six-second Commercials, drive major outcomes,” said David Roter, Snap’s VP of global agency partnerships, in an e-mail statement about the study. “Snap internal data showed our immersive six-second ad format is effective at achieving both upper- and lower-funnel [objectives] for advertisers, and we wanted to test this hypothesis.”

The study compared six-second and 15-second ads on Snapchat. The 15-second ads are skippable on Snapchat. The study also looked at two other types of platforms, one was an unnamed “video aggregator” and the other was an unnamed “full-episode player.” A full-episode player is more like a TV network’s website, where viewers watch longer shows, and a video aggregator is closer to Snapchat’s style of video.

IPG Media Lab and Magna ran the study with four brands—Lego, Mini, Clinique and an unnamed consumer products brand. The result seemed to show that six-seconds performed better than 15-second ads on Snapchat in categories like “purchase intent” and “brand favorability.”

The results showed that nothing beats a 15-second ad that is unskippable on a full-episode player. In that setting, the longer ads were more effective. Still, the study emphasized that was only within the context of full-episode player video inventory. “With more traditional video, 15-second ads work best,” the study said.

Read the Article on Ad Age
Read the Press Release 
DOWNLOAD THE FULL REPORT