Media inflation is hitting television hard, with advertising costs rising 31.2% from pre-pandemic levels – the biggest jump in two decades.
Compiled by Warc, the bi-weekly analysis of global advertising trends showed no letup in soaring global TV media costs, with the sector growing 9.9% year-on-year in 2022 alone.
The closely watched cost-per-thousand (CPM) measure now stands at $20.01 globally, but that figure conspires to mask significant regional disparities, led by the United States, which will hit 73.14 $ this year – a 40% premium over 2019 – as the market accelerates deeper into unaffordability. In contrast, cool heads prevail in China and the UK with CPM values of $3.09 and $10.56 respectively, and Australia sits somewhere in the middle at $34.69.
Rising costs have illuminated a bleak prognosis for UK ad spend
The marketing intelligence report notes the increased impact of steadily rising prices on the food category in particular, with advertisers experiencing an 18% drop in impressions between 2019 and 2022 for every dollar spent.
Alex Brownsell, Head of Content at Warc Media, said: “As linear TV’s share of total media consumption declines, particularly among younger audiences, brands are looking elsewhere for additional reach. However, the effectiveness of delivery through channels other than TV is threatened by inflation across the media ecosystem. »
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While TV takes the cake from soaring prices, it is far from alone, with digital media costs also rising rapidly as TV advertisers look elsewhere for more profitable channels. This has seen paid social CPMs increase by 33% between 2019 and 2021.
These fluctuations present often overlooked categories such as radio in a more favorable light. In Australia, for example, CPM radio media costs fell from $6.22 in 2019 to $5.93 in 2022, mirroring a similar trend in the UK, where costs fell from $2.48 to 2 $.39. Outdoor advertising (OOH) is emerging as another attractive proposition for bargain hunters, with UK outdoor advertising prices now 3.1% lower than pre-Covid. This trend is even more pronounced in the US, where the OOH market is now 5.8% more affordable than it was in 2019.
Brownsell added: “As the global economy teeters on the brink of an inflationary recession, media costs could see increased volatility. Nonetheless, non-video channels are worth considering if they suit the audience.
Rising costs have illuminated a grim prognosis for UK ad spend, with the Advertising Association (AA) and Warc forecasting stagnation in 2022 before an outright contraction the following year.