LONDON: Spending on traditional media channels has suffered for several years at the hands of a succession of digital ones – internet, mobile, social – but there are signs of change that could herald a more stable future.
“Is there an indication in these forecasts that the market is finally moving to an equilibrium?” wondered AA chief executive Stephen Woodford at yesterday’s launch of the AA/WARC Expenditure Report.
He noted that the growth rates predicted for 2018 and 2019 showed digital spending increasing at a slower rate while print declines more slowly than in previous years; at the same time, radio, outdoor and cinema continue to grow and TV spending is set to recover.
Catherine O’Neill, media analyst at Citi, picked up on the figures for TV expenditure, observing that some assumptions held in financial markets are more cautious than this.
“What’s driving such a rebound?” she asked. Is it simply because TV is exposed to certain larger sectors that have held off from advertising for several years and which are now returning, or is it recovering share from other media sectors?
Either way, however, she doubted it would be enough to “entirely allay fears of an acceleration in that structural shift” the industry is going through. The question remains whether internet will start taking TV money in the same way it has taken print’s or whether TV can continue as a strong proposition.
O’Neill also highlighted the potential impact of GDPR – an area she suggested had, rather surprisingly, “gone under the radar” for investors, but which offers “an opportunity for traditional media to push its advantages”.
An understanding of the audience, engagement and content is as important if not more so than just “borrowing a volume of eyeballs”, O’Neill maintained.
Traditional media are also better placed to address the issue of reputational risk, she added, which is something that “has really risen up the agenda of corporates”.
At the same time, GDPR has the potential to help increase transparency and consumer trust in the advertising industry. But she warned of possible unintended consequences as people’s inboxes fill up with emails from brands seeking permission to continue using personal data.
“Some of these operations that already have scale and are already embedded in consumer habits may end up in a stronger position,” she said. “It will be easier for anyone with an existing relationship to continue direct marketing.”
Sourced from WARC