Fuelled by savings piles accumulated under work-from-home (WFH) and asset price inflation, the strong recovery of private consumption in H2 2021 from the depths of successive lockdowns drove spectacular growth in UK display advertising, up by 24% on 2020 to £16 billion, noting base effects from the dramatic plunge in 2020

With consumers largely WFH in 2021, TV soared 25%, online 28%. Spend on cinema and out-of-home (OOH) in 2021 remained well below 2019 values. In-home goods and services have been strong while those consumed OOH are weak. Government spend on public health messaging remained high in 2021

Private consumption, now also impacted by CPI inflation, will trend upwards in 2022 and power display advertising growth of over 9%, driven by online spend and the continued recovery of cinema, OOH and the press. The sunny uplands we forecast for 2022 could rapidly cloud depending on the course of Omicron as we face Year 3 of the pandemic

Podcasts are a small but growing medium, and global streamers and domestic audio players alike are investing heavily in podcast content, distribution and advertising technology.

The broadening choice and diversity of podcasts available has put discoverability, exclusives and personalisation at the heart of the race to become the number one destination for audio.

While the UK currently lags other markets in terms of advertising and monetisation, increasing financial viability coupled with
healthy listener demand suggests a bright future for the UK podcasting sector.

The UK’s Q3 GDP growth paints a picture of stolid recovery, leaving GDP still 2.1% below the pre-pandemic peak in early 2020. We expect Q4 will be much stronger, mainly due to booming retail—very beneficial to advertising growth—and returning the economy to peak GDP early in 2022

We predict record highs for retail sales in Q4 with volumes surging on the back of base effects in the previous year, seasonal highs, and ongoing work-from-home (WFH) practices, compounded by a 6-8% YoY increase in retail prices, which could yield up to 14-16% sales value growth

Aside from fizzing retail, the economy enters 2022 facing headwinds from bubbling CPI inflation as energy prices surge on global markets, higher prices for food and other essentials, and Brexit-induced shortages of labour and goods that are hard to alleviate in this island’s economy

Overall radio listening remains robust and continues to make up the majority of audio time, however a worrying decline in both reach and hours amongst younger people makes further innovation necessary

Shifting audio distribution trends driven by digital and IP listening, as well as the increasing influence of smart speakers and connected devices, represent significant challenges for the radio industry going forward

Strong collaboration and regulatory support will be needed to reconnect with elusive younger listeners, prevent US tech companies from becoming de-facto gatekeepers, and preserve the public value at the core of the UK radio industry

Facebook has been caught unawares by the significant impacts of privacy changes to its advertising revenue, posting an uncharacteristic quarterly decline as its costs are set to spiral

Facebook’s ageing user demographics are a long-standing and growing issue, as competitor platforms erode Facebook’s attraction to the young. Recent negative PR only compounds a brewing problem of relevance as social media shifts towards being content, rather than network-driven

By pinning its name to the metaverse, Facebook hopes to redefine its narrative and claim the benefits of managing the platform of the future, but significant challenges in the entertainment, enterprise, and tech spheres stand in its way

Our UK-wide analysis of Google data on travel to work and to other destinations, at the granular level of Local Authority Areas, reveals the early return to pre-pandemic levels of mobility in smaller urban and rural areas, driving the UK’s economic recovery to date, while travel within cities remains depressed 18 months into the pandemic

On weekdays, work-from-home (WFH) for office workers is a core driver of reduced mobility in London and other cities reliant on public transport, recovering on weekends, but mainly to local destinations. Outside cities, the car is used for transportation, explaining the faster recovery of mobility there

Disposable income inequalities have widened between office workers that saved due to WFH and essential workers and those in B2C activities in cities have not had the privilege of WFH. The quicker return to offices in smaller urban and rural areas has restored pre-pandemic expenditure patterns

Apple’s latest software update continues its drive to limit the data that can be collected about iPhone users as they browse the internet. Prior changes have had an effect on ad prices for publishers, and on advertiser results

The new changes target cornerstones of profiling and targeting: IP and email addresses. The impact will be gradual, but could be profound if takeup is high

The lesson for publishers is that no technical implementation of targeted advertising is safe. Layering third-party data on top of anonymous audiences is not a future-proof business model

Netflix’s decision to launch games as part of the subscription bundle is smart business: rewarding current subscribers, leveraging its IP, and signalling that subscription is the best long-term revenue model in the games space. 

Expect technological innovation to be central to Netflix’s ambitions with games. Netflix will make it easier for different game experiences to occur, and ways to attract external developers will inevitably follow. 

For Disney, Netflix just made the battle for customers more difficult and more expensive.  Disney will need to make hard decisions about how to approach the games business—something it has shown before it finds difficult to do. 

After China updated its Anti-Monopoly Law to cover platform companies, the Government is bringing to heel privately owned ‘national champions’, including via antitrust measures in their home market—the key source of their astronomical cash flow—and through interference in their expansion outside China

China lacks any tradition of anti-monopoly activity, given its gradual shift to the market from state-owned enterprises, it offers an example of theory in practice for antitrust reformers targeting platforms in the West

The global implications are huge: up to $2 trillion of Wall Street shares are exposed as China tightens controls on foreign IPOs. Regulators could also use enhanced antitrust powers to disrupt global dealmaking for economic leverage

• The three lockdowns since Q1 2020 shifted the sales of ‘non-essential’ stores (e.g. clothes) to online, with deconfinement releasing the oxygen of pent-up demand to the high street, eroding online’s share
• For vendors of ‘essential’ goods (e.g. food and drink), which stayed open, Work-From-Home (WFH) shifted a large portion of spend to in-home purchases, with both offline and online spend remaining elevated in Q2
• The share of online in retail sales (excluding fuels) dropped from its peak of 34.7% in Q1 2021, when the UK was in its third lockdown, to 27.6% in Q2. This is still up 10 ppts from 18.7% in Q2 2019, evidence of a new post-pandemic normal, as mobility to retail and recreation destinations remains impaired