Travel advertising has been hit hardest by Covid-19 as the travel advertising market lost 46% in 2020. The advertising market has shrunk by only 4%. Travel advertising spend is estimated to have increased from US $ 18.0 billion in 2019 to US $ 9.7 billion in 2020.
Zenith’s business intelligence report predicted that travel advertising in 13 key markets would increase by 24% in 2021, before 36% growth in 2022 and 19% growth in 2023.
In the report, the target markets were Australia, Canada, China, France, Germany, India, Italy, Poland, Russia, Spain, Switzerland, UK and the United States, which together account for 74% of total global ad spend.
Report says brands will need to refocus their communications on different audiences as they adjust to the decline in business travel as companies coordinate more international activities with remote meetings, and address consumer concerns regarding the sustainability of travel and adapt to growing demand. for low carbon journeys.
The pent-up travel demand, according to the report, will lead to rapid growth in travel ad spending over the next several years. Travel ad spend would still be 33% below its 2019 level in 2021, while the ad market is expected to be 7% ahead. Travel would have to wait until 2023 for travel to surpass spending levels of 2019, when it will hit $ 19.6 billion.
Travel advertisers in 2020 spent 63% vs. 58% on digital advertising compared to the average brand. Additionally, travel advertising made 32% of e-commerce sales in 2021, compared to 20% for retail.
Digital travel advertising aims to engage consumers in the early stages of research, through search advertising and display and video ads in relevant content. As travel becomes more and more digital, digital advertising would become even more important for brand creation and conversion. Integrating travel apps with vaccine passports, using them to help consumers navigate local COVID rules and bureaucracy, and offering digital concierge services will accelerate travel’s transition to a seamless digital experience. , from the initial research to the enjoyment of the destination.
Zenith predicts that travel brands’ digital ad spend will grow by 6% per year between 2019 and 2023. By 2023, travel brands will spend 70% of their budget on digital advertising, up from 63% in 2020.
Ben Lukawski, Global Strategy Director at Zenith, said: âTravel was one of the first industries to embrace digital while booking was online. After COVID, the top performing brands will complete this transformation by making the total experience digital, from reducing form filling to contactless entry, removing almost all possible friction from the experience. “
Travel advertisers spent 20% of their budgets in 2020 on newspapers, magazines and signage compared to the average, compared to 13% for the average brand. Advertisers spent 13 percent on television compared to an average of 24 percent. Consumers look for choice and value, which is why media that allows brands to display a range of options and certain pricing details are particularly effective.
Print travel advertising spend is declining as circulation continues to decline, but outdoor advertising is expected to recover from its crisis in 2020 and grow at an average rate of 6% per year between 2019 and 2023.
Zenith expects the fastest growing travel advertising to come from India and Russia, where ad spend will be 31% and 21% respectively by 2023. Here, the increase disposable income means more people travel and existing travelers travel more frequently. . The same goes for China and Poland, where ad spend will increase by 16% and 14% respectively between 2019 and 2023.
The strong US advertising market is pushing up media prices, which is the main reason that travel ad spend will increase by 13% in 2023 and 2019. This period, depending on consumer demand, media inflation, digital technology adoption and a myriad of other reasons.
Jonathan Barnard, Forecast Manager at Zenith, said: âAs travel begins to recover from the unprecedented decline in demand in 2020, brands are rebuilding their relationships with consumers, using digital technology to guide them to each step. Online video will play a key role in creating emotional connections with consumers, inviting them to take their first steps on their digital journey. “