The U.S Ad Industry Stages a Remarkable Comeback from Covid-19

Lockdowns during the height of the pandemic were devastating to the U.S. ad industry, as they were for the economy and society as a whole.

But advertising has made a remarkable recovery with growth now nearly in line with spend projections from before the emergence of Covid-19.

Standard Media Index (SMI) estimates that the first 19 months of the Covid-19 pandemic cost the U.S. advertising industry at least $17 billion in money not spent by the biggest advertisers in the market. The worst impact was in the spring of 2020, which saw a 38% year-over-year drop from the same period in 2019, as measured by the SMI Pool of invoice details from all major ad agency spending.

Our analysis looks at what the market lost in comparison to a projection of what the industry should have spent by 2021 had Covid not occurred. The SMI Covid Deficit Backcast reveals the scale of 2020’s second-quarter spend gap, with a rebound catch-up at the end of that year. Into 2021, a gap from the projection remains, but in recent months the trend line of actual spend has nearly caught up to the projection.