Global media inflation is expected to hold at +3.3 per cent for 2020 according to a new study led by independent marketing consultancy, R3.
US media inflation rates remain in line with the global average at 2.7 per cent, while markets where new reported coronavirus cases have affected re-opening schedules, like the UK, Australia and Italy, have been hit hardest.
For this study, R3 reached out to five of the six largest agency holding groups as well as tapping into industry data from media owners and analysts. The final report covers 23 countries from North America, Europe, Asia Pacific, Latin America and Africa, across more than seven media types. In total, more than 3,000 data points were covered to derive the final overall number.
Big changes by quarter
R3 collected data by quarter for the first time in anticipation of dynamic changes resulting from COVID-19, and alarming variances have emerged, particularly in Q2 when most of the countries surveyed were under lockdown.
“It’s the first time in media history that viewership and engagement has gone up without the same growth potential in inventory and pricing,” said Greg Paull, Principal of R3. “COVID-19 has created a very unique challenge for media owners and a very unique opportunity for the boldest of advertisers” he added.
Print and outdoor will experience deflation in most markets as people stay at home. As the first country to come out of lockdown, China’s media market remains stable and buoyant as mobility resumed in Q1 and people have returned to commuting. The UK can expect further deflation in its already depressed outdoor market in Q4 as worsening weather and gathering restrictions keep people indoors.
Broadcasters in Europe face plummeting prices
A reduction in demand in inventory as marketers shelve or decrease ad spend sees UK television advertising prices drop by an average 14.7% in 2020, only to be outdone by outdoor advertising which will see deflation as much as 23%. In US, media inflation rates for television advertising remain stable at 5.7%.
Asia tells a different story with higher prices expected for television media in markets like Indonesia, Thailand, and India where people remain dependent on broadcasters for news.
“Broadcasters without alternative revenue streams are going to be particularly vulnerable,” says Paull. “In Asia, top advertisers tend to represent essential services like food and telecommunications, while in Europe, high-spending categories like travel and sports have seen their revenue fall deep into the red.”
Online display faces challenges
Global uptake of gaming and streaming video will see buyers paying more as online video will face high demand. Media buyers in China will be experiencing inflation on online video of as much as 11.3%, compared to the US where inflation with stay around 1.5%.
Online display will not experience as much price increase as online video as the medium faces challenges related to brand safety during COVID-19. Brands and platforms have added terms related to the pandemic to keyword block lists, impacting the revenues of news publishers.
“As more marketers look to spend money programmatically on ad-supported streaming platforms, we’ll see a pressing need to ensure that the ads online are measurable, safe and not affected by fraud,” said Paull.
Please login with linkedin to commentR3
Twitter has just experienced its fastest growth in revenue since 2014, with the social media platform benefiting from increased interest from advertisers. Revenue was up 74 per cent YoY, according to the company’s Q2 results, reaching $US1.19 billion ($1.6 billion) from $US683.4 million ($925 million) 12 months ago. The strong results came in the same […]
Wild Turkey has announced the launch of its new global creative campaign and platform, ‘Trust Your Spirit’, featuring the brand’s creative director and spokesperson, Matthew McConaughey. The global campaign and platform ‘Trust Your Spirit’ is to encourage people to be bold, unapologetically themselves, and stay true to who they are. The global tagline and ethos […]
Telecommunications company Optus has announced it will launch the world’s first TikTok sign-language activated filter. Featuring Optus ambassador Ian Thorpe, Optus will unveil a branded effect that shows TikTok users how to say key phrases in Auslan sign language, including ‘How are you?’ and ‘It starts with Yes’, through the hashtag challenge #SignYes. Optus will […]
Podsights has revealed new insights into the effectiveness of advertising in podcasts, tracking global and Australian podcast advertising trends. This is the first Australian report to be published since ARN partnered with Podsights to set the standard for best-in-class podcast advertising measurement. The report includes additional analysis and follows a series of Measurement Masterclasses held for […]
NGEN’s 2021 charity cup has raised over $175,000 for UnLtd charity partner Gotcha4Life. Gotcha4Life is a not-for-profit foundation raising awareness and funding to provide educational workshops and innovative programs that build mental fitness in individuals and communities. While Sydney and Brisbane completed the Charity Cup in June, before Covid restrictions hit, the final leg in […]
Australian tech incubator Cicada Innovations and Biennale of Sydney are launching the ‘New & Sustainable Materials Challenge,’ in an effort to create a more sustainable future. The works of chosen material-makers will be showcased to millions of Biennale audiences, exhibition partners, and exhibition makers globally. The Challenge is open to any Australian and UK startups, […]