According to the findings of Zenith’s Business Intelligence – Telecommunications report, Telecom ad spend in the 12 key markets it covers will rise from $17.8 billion in 2020 to $18.7 billion in 2021, and then return to its pre-pandemic level of $19.5 billion in 2022. Its growth will be spurred on by demand for new smartphones and 5G.
The report notes that high-impact advertising in mass-audience media like television and radio allows telecoms companies to differentiate themselves from others through branding, and makes them more relevant to consumers by promoting their association with things consumers are passionate about, such as entertainment, sport and music. Telecoms brands therefore spend substantially more on television and radio advertising than the average brand – in 2020 they spent 42% of their budgets on television and radio, while the average brand spent 30%.
However, as audiences migrate online, telecoms companies are refocusing on communicating their brand narratives to mass digital audiences. Telecoms brands spend less on digital media than average (49% of their budgets went to digital channels in 2020, compared to 56% for the average advertiser), but digital advertising is also the only channel in which telecoms adspend is increasing. Zenith forecasts that telecoms brands will increase their digital adspend at an average rate of 5% a year between 2019 and 2023. By 2023, digital advertising will account for 54% of all telecoms advertising.
The report forecasts that India and Russia will lead telecoms ad spend growth, in the former case by 11% and later by 8% annually between 2020 and 2023. Most of the other markets in the report are forecast to grow by between 3% and 6% a year to 2023.