Festive advertising blitz is an early Christmas present for media sector

The pandemic has caused marketing sales to plummet, but Christmas could help ease the pain

The John Lewis Christmas advert featuring the song A Little Love by Celeste
The John Lewis Christmas advert featuring the song A Little Love by Celeste

It is a little piece of creative magic from one of Britain's biggest retailers that normally ushers in the festive season. 

But this year's Christmas advert from John Lewis & Partners has taken on a new significance amid a pandemic-induced crash in the advertising market. 

The money spent promoting the two-minute ad celebrating small acts of kindness comes as a welcome reprieve for broadcasters, which have stomached a £500m plunge in TV ad spending between March and June. 

The ad is just one part of a huge blitz being launched by retailers in the run-up to Christmas, which will provide a lifeline to the UK media industry as it battles back from one of the darkest times in its history. 

But can the sector count on the Christmas period - and retail sales bonanzas such as Black Friday and Cyber Monday - to set the tone for full-throated recovery from the ad market when the pandemic remains close at hand? 

Some of the forecasts remain gloomy. UK advertisers are poised to spend £724m less than last year at £6.2bn during the final three months of 2020. 

That marks a 10.5pc drop during advertising's so-called "Golden Quarter", according to the forecasts from industry bodies the Advertising Association and Warc.

The cinema industry is facing the worst hit - down 66pc during the period - with TV and radio dropping 2.7pc and 13.2pc respectively. 

Meanwhile, the UK's regional newspaper industry, which has been grappling with a downturn in sales and print advertising during the pandemic, is predicted to endure a 21pc plunge . 

A local newspaper source says advertising spend from heavy-weight companies was returning, but smaller firms were still hanging onto their cash. 

It is a chilling outlook, but parts of the sector remain optimistic. 

ITV, a bellwether for the ad market, announced last week that it expects total ad revenue to be slightly higher in the final three months of 2020, compared to last year. 

ITV, broadcaster of I'm a Celebrity Get Me Out of Here, is optimistic about the advertising outlook

That is a huge recovery from the height of the pandemic when total ad spend fell 23pc in July, as companies slashed budgets to protect their cash. 

The rebound was prompted by businesses loosening the purse strings, from consumer goods and supermarkets, to telecoms and publishing.

The UK's biggest commercial broadcaster also appeared to shrug off the second national lockdown by predicting a 6pc jump in advertising revenue in November. 

But while the rebound is encouraging, uncertainty remains. 

Before the pandemic, ITV had a clearer idea of how much money it would make because advertisers would book months in advance. 

That line of sight has been skewed by the Covid crisis. Advertisers are spending again, but few are willing to book into the New Year. 

Those jitters could also be stoked by Brexit. Crunch moments surrounding Britain's EU exit had a tendency to rattle the advertising market. 

A dearth of advertising from the travel industry, which continues to suffer at the hands of the pandemic, could also hamper ad spend in the first three months of the year. 

But while threats remain, forecasters are still predicting a swing to growth in 2021. 

GroupM, the media buying agency owned by WPP, expects the UK advertising market to grow by 13pc next year after falling by 13pc in 2020. 

Brian Weiser, GroupM’s global president of business intelligence, says the recovery is being prompted by advertisers adjusting to the pandemic. 

"The market is improving," he says. "Uncertainty relating to Brexit will have an impact. Some marketers have held back their budgets and flushed them away. Others also have concerns over the current UK lockdown, which could also be a potential drag. 

"But the UK is more like the American market, where the vast majority of marketers have figured out how to operate [in the pandemic]. 

"There are some areas like the travel industry, where if they cannot operate then they are not going to spend money. 

"But then no one is now counting on that money and you also have the offset from government spending on advertising."

Come the turn of 2021, the media sector will have a clearer idea of whether the Christmas ad blitz can prompt a return to normality. 

British soul singer Celeste urges everyone to "give a little love" with her song for this year's John Lewis advert. 

The media industry will be hoping it is a tune that sticks in advertisers' minds when they draw up their budgets for the New Year and beyond.