The cost of television advertising is set to rise to 11%-13% as media inflation continues to take its hold on the industry, Zenith’s latest Advertising Expenditure Forecasts report has revealed.
Prices for all traditional advertising channels have been predicted to rise across the board as the sustained growth in demand from advertisers pushes up media inflation.
While global advertising expenditure is forecast to grow 8% in 2022, television marketing is set to take the biggest hike in price as the supply of audiences falls steadily as viewers switch to alternatives.
A shocking 99% of Generation Z consumers have admitted to frequently skipping ads, in a new report released by digital consumer research firm Bulbshare.
Online video prices are also expected to increase by 7%, although in this case the supply of audiences is rising.
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“Other digital channels where supply is climbing and volumes are flexible are inflating only modestly, with 3% average price rises forecast for social media and other digital display,” Zenith added.
“Out-of-home and radio prices will go up about 4% this year, while print prices will remain stable, because demand for advertising in printed publications is falling as rapidly as readership.”
Brands that buy broad audiences to achieve reach targets ‘will not be able to avoid’ having to spend more to reach the same audiences previously acquired.
However, according to the report, brands that use first-party and third-party data to identify profitable customers and target their best prospects in the most efficient channels, will be able to ‘mitigate’ much of the effect of media inflation.
The data and technology specialists also predicts 62% of ad budgets will be spent on digital media in 2022, up from 59% in 2021, and that this proportion will reach 65% in 2024.
“In a world where trading is becoming dominated by auctions, competitive advantage is achieved not by scale, but by data,” Zenith global chief strategy officer, Ben Lukawski, said.
“Inflation will hit cheap reach buyers hard, but brands that make smart use of their data will manage costs and grow their business at the same time.”
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