Advertising market trend: Corona crisis shows first massive consequences

The Corona crisis is leading to a turnaround in the annual advertising market trend. While in "normal" years the curve of advertising pressure regularly points upwards from March onwards, this year is different: The gap to the previous year amounts to minus 90 million Swiss francs or -16.4 percent in the month of March. This means that the first quarter of 2020 is 114 million behind the previous year's figure. This corresponds to a decline of -8.2 percent, according to the latest figures from Media Focus.

Media groups affected to varying degrees

In percentage terms, cinema advertising fell the most in March (-77%), followed by radio advertising (-49%). Print advertising declined by around 20 percent, with the daily, weekly + Sunday and trade press being hit hardest. The general, financial and business press, on the other hand, remained at the previous year's level. Internet (-17%) and TV advertising also recorded noticeable losses (-15%). Only out-of-home advertising print remained at the prior-year level overall in March (-0.7%).

With the proclamation of the "extraordinary situation" in Switzerland on March 16, 2020, calendar week 12 shows the biggest slump in advertising print across all media groups. However, differences between the individual media can be observed: while cinema advertising dropped to zero after the closure from week 12 onwards, as expected, the decline in the other media groups was already less pronounced the following week. After the initial shock, it is clear that a disruption, which the current exceptional situation undeniably represents for the advertising industry, creates obvious winners and losers. The cleaning industry experienced the biggest boost in March with a 33.2 percent increase, followed by tobacco advertising with a 24.2 percent increase. Cleaning and smoking: So that's what Mr. and Mrs. Swiss are most likely to indulge in during the lockdown....

FOPH campaign strong - the car industry lacks the car showroom

Due to the FOPH's Corona campaign, the "product" with the highest advertising pressure in March 2020, the "Initiatives and Campaigns" sector experiences a significant increase in advertising pressure (+5.7%) and the financial sector also closes slightly up (+1.9%). Looking at the year-to-date performance, however, this should be interpreted as a standstill. The industry started January and February with a good 20 percent more advertising pressure than in 2019.

However, the fact that campaigns were stopped at short notice from calendar week 12 can so far only be observed with a few advertisers. One example of this is the automotive industry: this sector has had to contend with the highest absolute year-on-year decline, not least due to the absence of the Motor Show. For example, the campaign for the VW Golf 8, which was still on the silver podium of the TOP 10 products in March, has largely disappeared from the communication channels. The advertising offensive in TV, OOH and cinema was short-lived and came to an abrupt end in week 12. Only online advertising continues as usual. Whether this was planned can at least be raised as a question.

However, the sector that loses the most ranks in March compared with the year to date is Leisure, Catering, Tourism. Clearly in first place in January and February, this sector drops to 10th place. Advertising pressure has fallen steadily by a third since January. Year-on-year, the decline comes in at -12.7%. March 2020 is around 40% below the previous year's figure.

Advertising market trend in outlook

If you don't advertise, you die: But this bon mot also applies during the crisis. Because the current situation offers those who communicate agilely good short-, medium- and long-term positioning opportunities. For example, by adapting the advertised product range (bicycles: +41%), highlighting services such as the online store (SportXX, from 23.3.2020), or building up an image (partnership rules of conduct: Coop/Migros/Denner). And a simple logic should not be forgotten either: if the competition reduces its activities, then its own "advertising voice" in the market gains more weight while the advertising pressure remains the same (SOV%). And attention is guaranteed: because the time and attention that the Swiss population devotes to the media in times of home office and quarantine cannot be at fault at the moment...

Source: Media Focus GmbH