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Innovation and diversification, amid growing international incumbents

Media spend in 2019 for France was $393 million, placing it eighth in a GroupM forecast for highest spenders, over Germany. “Digital is still the largest medium,” according to GroupM, which also predicts that TV will remain stable, print will remain challenged, and outdoor advertising and new channels will see pockets of growth. The forecast predicts nearly double-digit reductions on print ad spending in France, as digital continues to take the lead. In 2019, digital ad spending accounted for 41% of total ad spend, or €4.9 billion ($5.78 billion), according to eMarketer. Spending on social media ads is going up, despite new privacy restrictions put in place by tech giants such as Facebook that limit data sharing and targeting. Google and Facebook dominate France’s digital advertising landscape, making up more than 75 percent of spending on digital ad formats in 2019. Google remains the default for search, while Facebook dominates in social media. As in other markets, audio advertising in the form of podcasts and branded audio content is starting to emerge.

Ad blocking stabilizes, but more disruption ahead

“Dimension 2019: Balancing the brand scales,” a 2019 Kantar report, surveyed 5,000 connected adult consumers in five key markets: Brazil, China, France, the UK and the US. It found that ad blocking, while leveling off in terms of growth, is now well established in France. However, overall the French are ambivalent about ads; 49 percent of French connected consumers say they sometimes or always use an adblocker. The number of French consumers who say they always use one rose from 23 percent to 25 percent between 2017 and 2019. Many French consumers dislike advertising or are indifferent to it: 37 percent told Kantar they dislike ads and 43 percent say they are not bothered about them. Just 21 percent say they enjoy ads.

There are new challenges on the horizon as more consumers switch to premium streamed subscription services and trade up to the ad-free entertainment experience.

2019 was an active year for video-based media owners operating in Europe, including ProSiebenSat.1, RTL, Mediaset, the BBC, ITV and Discovery Communications—all of which hope to compete with the expanding sprawl of Netflix, Amazon, Google and Facebook, as well as new incumbents in entertainment’s “streaming wars,” including Apple’s new on-demand platform.

“Global competition and commercial threats are likely primary motivators,” explains Brian Wieser, Global President, Business Intelligence, GroupM. “While there are undoubtedly interests in pursuing new growth and cost-effective ways of sharing development costs, a more important factor is undoubtedly the ongoing expansion of US-based giants within Europe. These companies are bringing new competition to what were otherwise relatively stable and oligopolistic markets.” He adds: “With their global scale, these companies are potentially better positioned to develop new properties or secure rights—including sports rights—with substantially lower tax rates relative to domestic incumbents.”

This will create marketing opportunities, says Wieser: “Many of the initiatives will present new advertising opportunities for marketers. Marketers can prioritize resources by assessing those most likely to succeed.”

Rules for Success

While Big Tech remains strong, new channels, entertainment platforms, and tie-ups present opportunities for marketers in France.

Marketers need to contend with a sense of apathy towards advertisements—ads need to continue to push creative boundaries.

As in many major markets, smart speakers and audio recognition are becoming key new consumer communication channels.

While adblocking has levelled off, new challenges in the form of premium subscriptions are set to disrupt communications further in France.

While TV remains stable, digital is the continued dominant growth story in ad spending, overtaking print media, which is seeing heavy declines in France.