Wednesday 6 January 2021 6:55 am

Cinema is the clear loser of the pandemic advertising economy

The clear winner of the pandemic ad economy is online, driven by the huge jump in e-commerce, despite travel-related advertising being impaired by the pandemic’s international scope.

According to new data from Enders Analysis, the London-based media research firm led by Claire Enders, more than half of all advertising spend last year was on digital platforms, surpassing offline display for the first time.

The share of online display advertising, such as video on demand, digital broadcasting and online press, leapt from 44 per cent share of total display in 2019 to reach 53 per cent in 2020.

Cinema, on the other hand, had a nightmare year while broadcast, media, radio and TV also suffered from their usual recession-induced declines. For TV, the expected 11 per cent decline for 2020 matches the economy’s expected GDP decline rather than exceeding it as was the case in the 2008-2009 recession.

Read more: Struggling Cineworld leads the list of 10 most shorted UK stocks

Wider advertising space

The plunge in the UK economy in the second quarter of last year, due to the pandemic-induced lockdowns, reduced advertising expenditure by close to one-third, slightly recovering in the third quarter.

“Impaired mobility of consumers dramatically reduced expenditure on print and out-of-home media, which are reliant on footfall, alongside cinema, whose theatres have been shuttered on and off all year,” according to Enders Analysis.

The researchers highlighted “the paradigm shift in consumer expenditure” to e-commerce in 2020 boosted online display while search was flat due to impeded travel plans. For this year, Enders expects e-commerce to moderate this year as mobility partly returns.

Read more: What will 2021 bring for the advertising industry?