Global Newspaper, Magazine Ad Costs to Soar in 2005

30 November 2004

Initiative Worldwide, the Interpublic-owned media planning and buying network, has fired a warning shot across the bows of the global print media industry.

Predicting that ad rates will surge globally by 9.2% - well beyond expected rates of inflation - newspapers and magazines are in danger of pricing themselves out of the media mix, cautions Sue Moseley, managing director of Initiative Futures Worldwide, the network's research unit.

Initiative's 2004 media cost and inflation report monitored forty-four different markets around the world, measuring the ad costs-per-thousand individuals reached by television, newspapers, cinema, internet and radio. The study predicts that CPT for magazines will rise 6.8%, while the same yardstick for television will register an increase of 5%.

Says Moseley of the inflationary trend: "What's surprising is the extent to which it's continuing to grow." She attributes the rise to "demand and supply", also observing "it's good news for the media owners and something that the media buying industry has lived with for many years."

Since 2000 newspaper advertising costs have risen 41%, an increase Moseley believes is unsustainable: "Increasingly less economically viable," to use her exact words. "Supply is falling, demand is growing but at some point there's going to be a realignment where people say 'hello, that's no longer affordable'."

In the year ahead, the global media costs surge will be led by China, Latin America and Russia.

Cinema remains the most expensive medium per 1,000, its higher cost due to its powerful impact on a captive audience. But the report forecasts a 0.5% fall in the CPT of online advertising - currently three times that of TV - thereby marginally reducing the price differential between online and traditional media.

Radio, meantime, has delivered more audience for advertisers' money over the last four years, although outdoor is still the cheapest medium.

Data sourced from; additional content by WARC staff