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As healthy as you think? // Eating our Peloton casquette

06 Dec 2019  |  David Pidgeon 
As healthy as you think? // Eating our Peloton casquette

The relentless fluctuations of adspend forecasts can sometimes make the eyes glaze over, but GroupM's latest UK figures, published at the start of the week, are remarkable when you take a long term view and are certainly worth paying attention to.

Wheeling out that incredibly tired phrase 'amid economic and Brexit uncertainty', the UK advertising market is now forecast to grow more £7.1bn by 2024.

Even over the short term GroupM has revised its expectations for 2020, now predicting growth of 6.7% to £24 billion rather than its previous forecast of 4-5%.

Why? Well, it's largely down to a list of companies that we all rely on but often lambast for not paying enough tax, or unfairly undercutting the local competition, amongst myriad other complaints.

So thanks goes to Facebook, Amazon, Netflix, Alphabet, Uber et al, who spent more than £20 billion on advertising globally in 2018, and are likely to spend more than £25 billion in 2019 - equating to approximately 5% of the world's total spending and a full percentage point of growth.

In the UK there is also huge growth more generally in digital pure-play media - predicted to end 2019 with a 15% year-on-year rise and remain resilient in 2020.

All good news, no doubt. But we heard an interesting and valid caveat to accompany the reading of these and similar figures.

"The GroupM figures are an important vote of confidence in the effectiveness of the ad sector, but when it comes to predicting long-term sustainable success, the overall spend of businesses is the wrong measure," Paul Wright, UK managing director of AppsFlyer told Mediatel News.

Wright argues that the industry should record an increase in the return on this adspend instead, pointing to the global ad fraud problem – which is getting worse and could reach $23 billion globally in 2019.

To that end, Wright says marketers should demand full transparency from their partners, while the industry more broadly should invest in new AI and machine learning technologies, switch to "smarter KPIs" and commit to recording and reporting fraudulent activity at each level of conversion to properly tackle the scourge of ad fraud and secure the industry's long-term health.


The wheels have come off, but does it even matter?

The only thing worse than being talked about is not being talked about, said Oscar Wilde. And so one often wonders whether 'PR disasters' actually do rather more good than harm in the majority of cases.

Protein World, for example, caused outrage with its 'are you beach body ready?' posters in 2016. The coverage and social media anger was widespread and the posters were subsequently banned – but the business made £1m in the four days after the backlash, a huge boost in trade for the then fledgling business.

We've often since wondered if some brands put out ads they know full well will get banned because the subsequent PR and social media exposure will be so high.

It might sound risky, but it seems to work.

So by accident or design (probably the former) Peloton now enters this tragic little stage. The exercise bike company, which this week unleashed an excruciatingly awful ad, derided for being both sexist and dystopian, 'lost $1.5bn in value' as a consequence of the backlash.

A 'PR disaster', no doubt.

But this time another absurdity surfaces - the abstract notion of 'value'. Peloton's shares may have fallen this week, but that represents human sentiment. We'll eat our casquettes if come Boxing Day sales in £2,000 exercise bikes haven't spiked alongside all brand awareness metrics.


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