• by Maarten Albarda , Featured Contributor, February 5, 2021

It’s the time when forecasts are being updated. The new year is one month old, data sets are being dusted off, and crystal balls are being polished.

Dentsu has a detailed global forecast out  that predicts a 2021 recovery, driven by an end to COVID-19 restrictions and unleashed consumer spending as a result, coupled with a year that includes the Tokyo Olympics and the European Soccer Championship tournament. Economists are equally giddy in their predictions on consumer optimism once the vaccine is rolled out sufficiently and limitations on travel and get-togethers are lifted.

Maybe it’s because I’m an old pessimist. Maybe because as I write this, it’s raining outside. I don’t know, but somehow, I fail to share the optimism that is being presented to us.

Economists in the U.S. say there is huge pent-up demand for all the things we can’t or should not do at the moment, like eating in restaurants, going to a sports event or movie theater.  I agree, and miss those things, too. And some say that because people have not been able to spend money on these types of activities, they have savings stashed away that will flow into the market the minute we are allowed back to pre-pandemic behaviors.

But we also know there is serious economic hardship, much of which will not magically disappear when we are “set free.” I predict a far more slow and probably very uneven recovery. For instance, restaurants that have shuttered will most likely not just reopen and bring back all the staff that had been laid off. It’s far more likely that, when market demand shows growth, those who are still around will benefit. Starting anew will be much harder, with cautious banks and limited investment due to uncertainty.

Take the travel industry. Yes, it’s very likely that people will want to travel for vacation or family visits. But the former daily bread and butter of the industry -- business travel -- will make a far slower comeback. Businesses have learned that a Zoom meeting can be effective, and maybe traveling to a client every week is not always necessary.

So it’s very likely the airline industry will continue to pivot away from connecting business destinations multiple times a day,  moving to a far more seasonal and less frequent type of scheduling. Make no mistake, air travel will rebound some. But I doubt we will revert back to the levels of business travel we saw pre-pandemic.

Warner and Disney are learning about launching movies on-demand and in theaters. Will they just toss those lessons out when COVID-19 is finally behind us? I doubt it. And I doubt that the movie theater industry will recover to pre-pandemic levels.

Will there be a place for movie theaters? Absolutely, for the full immersion experience. But I predict that movie theaters will go the same way as theaters for other art forms. There will be a few, in entertainment districts, catering to a proper night out. But they will not bring in the numbers they used to.

All these changes impact advertising budgets. They impact who has ad money to spend, and who will grow their ad income.

However, Dentsu and all others predict that digital will continue to be the number-one growth medium. That's a prediction I do agree with.