- Print spend to fall by 11.1%, radio to drop by 5.5%, television revenue to decline by 2.9% while Out-Of-Home (OOH) will increase by 1.8% and cinema will grow by 0.6%
- Overall online market to increase by 6.3% to €519.5 million, with online video increasing by 24% – Facebook and YouTube to secure as much as two thirds of additional online video spend this year
- Core calls for industry-wide approach, managed by the Institute of Advertising Practitioners in Ireland, to provide accurate, approved figures for the value of Ireland’s media market
- Core conducting viability study into the founding of a new graduate school of marketing that establishes ‘licence to practice’ for all marketing practitioners in Ireland
- Government urged to commission an independent report to examine state of the news media in Ireland
Core, Ireland’s largest marketing communications company, is forecasting that total media spend in Ireland will grow by just 0.6% in 2019 to €1.044 billion.
As with previous years, online will deliver the growth in the market, albeit at a slower rate than before, while offline media will see a third consecutive year of decline, with overall spend falling 4.5% to €525 million. Meanwhile, the level of total media spend in Northern Ireland is expected to increase by 2.1% to £188.8 million (€214.5m).
The figures are contained in Core’s annual ‘Outlook’ report which forecasts spend for 2019 across a variety of media, including Video, Audio, Print, Online, Sponsorship and Out-of-Home. The report also outlines the key developments and important issues that will impact the industry this year.
Key predictions from Core Outlook 2019 include:
Television – While television revenue grew by just 1% to €221.3 million in 2018, driven by sponsorship and promotions, TV spend will contract in the Republic of Ireland in 2019, dropping by 2.9% to €214.9 million. TV remains the medium of choice for brand-building, accounting for one third of media spend for Ireland’s top 20 advertisers. However, the next few years will be challenging with modest growth levels, as Facebook and Google continue to increase their share of the video market.
Online Video – The online video market in the Republic was worth €77.8 million in 2018, representing growth of 29% on 2017. This year, the market will increase by 24% in the Republic of Ireland to €96.1million, with Facebook and YouTube securing as much as two thirds of the additional €18.3 million spend this year.
Radio – In 2018, radio recorded a 4.6% decline in spend to €117.6 million in the Republic
of Ireland. Core expects 2019 will be another difficult year for radio, with overall revenue in the Republic of Ireland falling by 5.5% to €111.1 million. Podcast listenership is growing, with 19% of internet users in the Republic of Ireland listening to this format on a weekly basis, across an increasing array of platforms.
Print – Overall print spend in 2018 fell by 10.6% to €119.9 million. Core predicts that the Republic of Ireland print market will contract by 11.1% in 2019 to €106.7 million, with national newspapers falling by 12.0% to €85.2 million.
Cinema – 2018 was a tough year for cinema in the Republic of Ireland, with overall spend falling by just under 5% to €7.37 million. A decline in the alcohol category was the major factor in the decrease. An increase in audiences, coupled with a minimum of four new cinema openings planned this year, should see marginal growth of 0.6% to €7.41 million.
Search – Investment in search is expected to grow by 9% in 2019. This could fuel further inflation, but with Amazon search expected to become available in Ireland late in 2019, costs could drop towards the end of the year. Search advertising will account for over half of all online media spend in the Republic of Ireland and Northern Ireland.
Online – The overall online market in the Republic of Ireland is expected to increase by 6.3% to €519.5 million. Despite all the issues surrounding Facebook last year, it will continue to increase its share of the online display market from 44% to 49%, with revenue totalling €108 million. This is driven by an estimated 30% growth in video revenue at Facebook this year.
Out-Of-Home – Advertising investment across all OOH formats is expected to increase by 1.8% in 2019, with revenue of €84.4m, with Digital OOH achieving a 25% share of all OOH spend. 2019 will be an interesting year for OOH, with the implementation of the Public Health (Alcohol) Bill imposing significant restrictions on how alcohol brands use the medium. Up to 60% of all panels in the country could be disqualified from alcohol advertising.
Sponsorship – Growth of 8% in all sponsorship to €189 million is expected, with sport continuing to dominate with rugby and GAA assets in greatest demand
A hard Brexit is not factored into the predictions for Core’s Outlook 2019. In the unlikely event that the UK does crash out of Europe, the impact on marketing budgets both here and in the UK will be significant.
While commentary from the UK suggests that a hard Brexit could result in a 5% decline in advertising investment there, the Republic of Ireland market is even more exposed: approximately 25% of advertising spend here is allocated from the UK in sterling. Economists believe that a hard Brexit will result in sterling falling in value by a further 10%, which (when combined with weaker sentiment in the Republic) would see investment levels contract by as much as 9% here.
In the case of Northern Ireland, a hard Brexit would result in a smaller decline, of circa 4%, due to anticipated increases in government spending on information campaigns specific to that region. Government spend remains a significant category in Northern Ireland. Offline media would bear the brunt of the declines in each market.
As estimates of the value of the media market across Ireland are often based on opinion and conjecture, often resulting in very different figures from different organisations, Core is now calling for an industry-wide approach that reports real approved numbers.
Alan Cox, CEO of Core, says that Core has invited the industry’s representative body, the Institute of Advertising Practitioners in Ireland, to manage the project:
“In 2019, we still rely on conjecture to estimate the value of the media market in the Republic of Ireland and Northern Ireland. This approach results in very different figures being quoted across the market. This needs to stop; we must agree an industry-wide approach that reports real, approved numbers. To facilitate this, Core has invited the industry’s representative body (IAPI) to establish a committee, with representation from all stakeholders, to manage this project. We are not suggesting that the advertising revenue of each individual media owner be published – that is unnecessary;
but what is necessary is an accurate breakdown of total spend by medium.
An independent third party, such as an accountancy firm, could facilitate this, while protecting the confidentiality of company-level information. A similar process is already in place for TV (managed by TAM Ireland) which employs a third party to establish an accurate commercial revenue number for TV (as a whole) from individual spends supplied by each.”
In a bid to ensure that Ireland has a sustainable media market for the future, Core is also calling on the Government to commission an independent report to examine the state of the news media in Ireland, the threats of the financial stability of publishers, the impact of search engines and social media platforms and the role of digital advertising.
The organisation says that it is critically important for Ireland to have a thriving, ambitious, inquisitive, energetic news media and the Irish government must realise the pivotal role that all our indigenous media play in our culture, values and national identity.
Alan Cox, CEO of Core, says: “There is a strong, positive link between media consumption and national belonging. We cannot take risks with this – it is a national crisis-in-waiting. Other countries are taking this matter seriously. For example, the Cairncross review into the sustainability of high-quality journalism, commissioned by the UK government, was published recently. The report found that investigative journalism, public-interest new and democracy reporting are the areas of journalism most worthy and most under threat for the market power of online platforms. It made several recommendations to create a better balance between publishers and platforms and to persuade the online platforms to use their position in more accountable ways. The Irish Government should follow the UK’s example and conduct a similar review here.”
Core is also calling on the Irish marketing industry to agree a plan that establishes a ‘licence to practice’ for all marketing practitioners – client and agency side – that will result in an exclusive education channel which will provide marketing graduates in the future.
The organisation says that for this professional-level qualification to achieve the standard required in a quality assured way, the industry will need to invest in building a new not-for-profit graduate school of marketing dedicated to this goal.
This college would provide students with a compulsory foundation in general marketing in the first year, including finance, business strategy, leadership and business case development. In year two, the students would specialise in their chosen field, be it brand management, media planning, research, data, public relations or creative. Once qualified, graduates would commit to 80 hours of CPD per annum to retain their licence to practice. This is an essential element of the plan; without this commitment to continual learning, the graduates’ initial qualification would become less and less relevant with each passing year.
Alan Cox adds: “Just 2% of third level graduates consider a career in marketing as very appealing. With this in mind, we should think of the new school of marketing as more than just a centre of learning; it needs to be a place of inspiration and creativity that inspires visitors and projects a powerful image of what marketing can achieve.
This plan will only succeed if the industry unites around this issue and establishes a true and long-lasting commitment, not just to the school, but to only recruiting graduates who have achieved the required professional standard. This means that the new college would be the exclusive channel for providing marketing graduates in the future.”
Core is currently working with a consultant to scope this project and conduct a viability study, which it will share with industry stakeholders before the summer. The purpose of this session will be to listen to feedback and discuss alternative ideas that people may have.
Other trends noted in Core Outlook 2019 include:
Television – While TV will not always retain its unassailable position, as viewing patterns continue to shift and live viewing ebbs, it is important to note that for the next five years or so, TV will continue to be the number one choice for mass-market brand building
Creative – Campaigns are often developed using a ‘one-size-fits-all’ approach to creative development. 30 or 40-second commercials are still being produced for online video channels, even though the typical viewing completion rate for ads of this length is only 14%. Advertising must always be designed to work in the medium in which it sits. We must never ‘shoehorn’ creative into any support medium, be it an online channel, or a traditional poster format. This is mission-critical, yet it is frequently missed by marketers and agencies alike.
Short Term Investment – Core estimates that 47% of advertising investment in 2018 was short-term in nature – a worrying increase from 43% in 2014. This is despite clear and compelling evidence that to optimise the long-term profitability of a brand, marketers should only invest 38% of budgets in short-term activation campaigns (using rational messaging) and 62% in long-term brand-building campaigns (using emotional messaging).
Brand Recall – The Core Brand Image Monitor highlights a worrying trend; recall of the top 100 brands in Ireland is dropping, despite the growth in advertising investment. This tells us two things; firstly, that the threat is real, and secondly, that volume of advertising alone isn’t enough to stop the decline. What matters is how budgets are invested. Businesses need to employ both short and long-term techniques in the correct proportion.
Instagram – Core expects Instagram to continue testing new features in 2019 as it grows its position as the key social shopping force. By the end of 2019, the Stories format is expected to surpass feeds as the primary way people share things with their friends.
Market Research – In the past, market research delivered value through hindsight. In the future, market research will deliver value through foresight. The role of research and the value it can deliver must evolve from explaining what has happened to predicting what is likely to happen and providing clear direction for brand growth.
GDPR – We can expect to see several GDPR-related fines applied this year. A key concern is that many companies have been distracted by their privacy and cookie policies and haven’t focussed sufficiently to ensure that data is held securely and is only available to authorised personnel
Core has a team over 300 people across nine practices – Creative, Data, Investment, Learning, Media (comprising of Mediaworks, Spark Foundry, Starcom and Zenith), Recruitment, Research, Sponsorship and Strategy.
Core has been voted Agency Network of the Year for the last six years at the Media Awards and the company was also recently voted one of the top workplaces in Ireland by the Great Place to Work Institute for the tenth year running.
To learn more about Core Outlook 2019, please visit www.onecore.ie/outlook