Pandemic to fuel 13% recovery in home-appliance ad spend in 2021

Author Moonshot.news

Published on: 04/10/2021

Investment in home improvements during the pandemic will fuel an almost 13% increase in home-appliance ad spend this year, according to advertising and marketing company Zenith’s latest forecasts. And despite the easing of Covid-19 restrictions, consumers are expected to continue to devote more of their time and budgets to the home than they did before the pandemic.

The Business Intelligence – Home Appliances report, focusing on 12 key markets, shows that home-appliance advertising will grow ahead of advertising as a whole in 2021, expanding by 12.6% while total advertising grows by 11.5%. 

Zenith’s forecasts at a glance

• Home-appliance ad spend to grow 12.6% in 2021
• Ad spend by home-appliance brands will total US$5.6bn in 2023, up from US$4.5bn in 2019
• Digital will be the fastest growing medium, expanding by 9% a year to 2023
• India and Russia to lead recovery with 18% and 16% annual growth respectively

Home-appliance ad spend will exceed pre-pandemic level by 24% in 2023

Forced to spend more time at home due to Covid-19, consumers are investing in making their homes more pleasant to live in, using some of the money freed up by being unable to socialize, commute or go on holiday, researchers note. This has helped home appliance advertising outperform the ad market as a whole during both the downturn and the recovery.

According to Zenith, there has been a rapid growth in demand for both large and small appliances, particularly cookers, washing machines, dishwashers and air conditioning units. 

Despite the easing of coronavirus restrictions, the company expects consumers will continue to spend more of their time and budgets at home, and forecast continued strong growth in home-appliance ad spend of 6% a year in 2022 and 2023. Zenith expects home appliance ad spend to reach US$5.0bn in 2021, 11.0% ahead of its 2019 level, and rise to US$5.6bn in 2023.

Digital to be the fastest growing medium

Digital will be the fastest growing medium, expanding by 9% a year to 2023, according to Zenith forecasts.

The company notes that home appliance brands already spend more than half their budgets on digital advertising. Digital ads accounted for 55% of home-appliance ad spend in 2020, up from 51% in 2019 and slightly behind the 59% spent across the whole market.

Home appliance brands spent 29% of their budgets on television advertising in 2020, compared to 24% for the average brand across the whole market. Out-of-home advertising is an important supplement, accounting for 7% of home appliance ad spend compared to 4% for the market as a whole.

“In most markets, the increased appetite for home improvement is incentivising home-appliance brands to step up their communications activities substantially,” said Jonathan Barnard, Head of Forecasting, Zenith. “Most of this growth is going to digital channels to support increased ecommerce activity, but traditional media like television and out-of-home will remain essential tools for maintaining mass brand awareness.”

Strongest growth to be seen in India and Russia 

Zenith forecasts home-appliance advertising to grow particularly quickly in India and Russia; at an average rate of 18% and 16% respectively a year between 2020 and 2023. Their rapid growth will be in part a reaction to their declines in 2020, which were much steeper than average, with spending down 15% in India and 22% in Russia.

Australia, Spain, the UK and the US also suffered from big drops in home appliance ad spend in 2020, and are consequently expected to enjoy healthy recoveries as brands recommit to the market. Zenith forecasts annual growth of 9% to 14% a year in these markets between 2020 and 2023.

The slowest growth is expected in Germany, Switzerland and Italy, where consumer demand is mature, with 0% to 4% annual growth in home appliance ad spend between 2020 and 2023.