Despite the global market recovering at an unprecedented rate, ad spending in Canada is still expected to outpace it.
This year, ad spend grew in all 70 ad markets followed by Magna, reaching double-digits in 68. The Canadian advertising market is one of them, growing by nearly 27% to $19.3 billion CAD, which surpasses the global growth rates, despite it reaching an all-time high of 22%.
Digital advertising sales gained 33% to $13.6 billion CAD after increasing 6% in 2020, as a shift in consumption patterns during the pandemic led to an increase in e-commerce usage. This is roughly in line with the 32.4% growth GroupM predicted earlier this week.
Ecommerce grew by 18% in 2021 and will gain a further 9% in 2022, alongside increased ad sales on low funnel channels, such as search (32%) and social media (37%). In 2022, digital ad sales are projected to grow another 12%.
As to what this means for Canadian advertisers, Leanne Burnett-Wood, VP of investments for Magna, says it’s encouraging to see the ad market bounce back after the declines in 2020.
“Brands are seeing the value in investing in the ad market across channels consumers engage with most,” she says, referring to how digital has driven growth. And while some channels have not yet returned to their pre-pandemic levels, the growth being seen is a positive sign. “While the media mix has changed, we are optimistic that overall spend levels will return in 2022.”
Television advertising sales increased by 21% in 2021 to $3.1bn CAD, thanks in part to cyclical events. TV, which represents only 16% of ad sales in Canada compared to 20% in the U.S., benefited from the return of live sports, specifically the NHL and NBA, as well as the Tokyo Summer Olympics the federal election in September. While 2022 television advertising sales are projected to grow by only 3%, driven in part by the return of the Winter Olympics in February, the television share of overall spend is expected to decline from 16% this year to 14.5% in 2022.
Outside of digital media and television, print advertising sales rose 2% in 2021, thanks to an increase in newspaper sales that offset a continued decline in magazines. Radio sales gained 7% and OOH jumped by 16% as Canadians began to resume normal activities.
The growth of emerging verticals will also help drive advertising sales going forward. Sports betting has recently gained in popularity in the United States, and with the legalization of sports betting in Canada this past August, Magna expects this vertical to grow in both television and digital media in the short term. Competition is expected to be fierce when sportsbooks launch in Ontario.
