Throughout history, commodity prices have been a hallmark of the economic crisis. But this time, it is not easy to read the leaves.
Regular advertising signals do not pass. In general, advertising prices drop in the middle of the financial crisis. Instead, this happened during the global shutdown in April 2020. Back then things were straight.
But this time, it is very difficult: there is so much controversy going on around this decline so that advertisers do not see that it is close to the recession and that they are wasting money, which contributes to prices. The quality does not make advertising prices the best for current economic growth. This is not to say that these prices do not reveal anything about the markets. They are not as confident as they always are.
Granted, the ever-increasing economic downturn in living prices, rising inflation and rising inflation are already slowing down advertising, but this is not slowing down online advertising prices. Otherwise, the incubeta marketing agency may see a noticeable change in advertising prices in May and June compared to the same months last year.
“When we look at our clients’ social media platforms, we see CPMs rising in late May and June,” said Harry Hughes, director of Incubeta. “However, compared to the same period in 2021, the results were similar, showing that the recent rise in inflation does not affect media prices at present.”
Availability of data
The real impact of rising inflation is down to another very important factor: a decrease in third-party response and the subsequent need for dissemination data as an alternative. Private marketing and data vector. As a result, those commitments become increasingly important. Economic instability does not change this. If there is anything, it strengthens the tree.
In January, the average CPM spent on private practice in the UK among five major software developers was £ 5.90. in May it was £ 9.01.
It is a similar story in CTV as CPMs continue to be controlled by the availability of resources.
“CPMs have been flat across Q1 and Q2 compared to the same period last year,” said Katie Long, chief marketing officer at ad tech Beachfront. “Even so, there has been an increase in spending from quarter to quarter this year. Much of what is driven by the audience continues to move from the line of view to the river. Economy is not a problem.”
Even so, owning one is still beyond the reach of the average person. Advertisers are reducing advertising. And when this happens there is less competition on the screen, which means less advertising to run CPMs. In fact, this is similar to a slight rise in prices behind the economy. That said, things change quickly. And if consumer confidence continues to decline due to “cost of living problems,” advertising prices could be affected after a year when advertisers backslide. in addition to their income.
Execs at Tinuito’s media have seen the news of the start of the first half of the year. Facebook CPMs purchased by the agency increased 6% annually in the second quarter, e.g. That’s the biggest decline from 33% quarter in the past, as advertisers struggled with strong comparisons of previous years. Although the price of Facebook for all businesses has dropped year on year in recent years, social networking sites show that this includes market exchanges and services that generate low-cost revenue. This could have far-reaching effects on the downturn in the recession.
“Our view here is that we are seeing customers reimburse for expenses and when this happens you see a drop in CPM – albeit differently,” said Kolin Kleveno, svp of mediaable media in Tinuiti. “Regardless of the channel, everyone is at risk as they feel the market is about to collapse. This makes advertisers reluctant to invest in media.”
This influence is reflected in a growing issue.
Digital marketing buffer
In the past, online advertising has been a reflection of the economic downturn. Along with the growing number of new advertisers, specifically for consumers who are pouring dollars into their advertising businesses, online owners have also benefited because advertisers are more confident that they pay more for ads if they know they are bringing in more. in business. Now, all that good is weak.
“The D2C market needs to be integrated, as many businesses with volatile assets appear to be on the decline,” said Joseph Teasdale, chief technology officer at Enders Analysis. “Add to that the fact that compliance and implications are growing, due to the growing technical and legal constraints.”
Economic growth can make things very difficult.
Indeed, rising prices have been a major concern for retailers since the outbreak. Just ask advertisers on TV. Two years ago CPM between 30 seconds for all major television viewers was £ 6.80 in the UK at the intelligence company Warc. The following year it was £ 9.64. In 2022, it was already at £ 11.65.
Opportunity and rising prices do not stop there – although most people watch less TV. This decline is not particularly noticeable at promotional prices as broadcasters continue to raise promotional prices to protect their borders. Not only did they take into account the number of online advertisers they wanted to use on TV for the first time, but they were also able to raise prices without much opposition from advertisers. Not when matching TV is still viewed – or seen for itself – as a starting point.
The problem for retailers, however, is what they buy for them. It is no secret that linebackers continue to turn to older viewers and hence the number of people who do not always represent the majority of regular advertisers. In other words, advertisers are paying less when it comes to online advertising.
Eventually, this will begin to come in the financial analysis of the advertisers. And when this happens, advertisers have to decide whether to continue spending as much as they do on TV advertising. Until then, inflation is expected to continue. But it will not be the driving force, it will be the behavior of the audience.
“The decline in prices is largely driven by a decrease in audience rather than earning (demand),” said Keith Welling, co-director at UM. “The level of inflation varies greatly from the audience. The price of the TV is still very competitive compared to the high-quality CTV / OLV screen saver for most audiences.”
So what about the rising TV prices and the other part of the measure? It’s like subscribing to make sure you don’t have high prices on TV – not really. The idea goes like this: if the advertiser has a way to buy and test the ads on all the broadcast and accessible lines then the price will go down. But this is not how TV sells. Instead, media outlets encourage advertisers to buy their product at a fixed price without having to report a little or no comment on the value of the dollar. The cost goes to the price of a TV but access does not. Not for advertisers who want small, diverse people. These opposing forces are unstable.