Global TV media costs surge almost a third post-pandemic

Media inflation is driving up the cost of advertising across channels, with TV most affected, according to an analysis by WARC Media. 

TV costs are rising fast

The latest Global Ad Trends* report, The rising cost of incremental reach, finds that, globally, TV CPMs (cost per thousand) have increased 31.2% since 2019 – the steepest incline in more than two decades – and are up 9.9% year-on-year in 2022. 

The trend is especially pronounced in the US, where TV CPMs are forecast to reach $73.14 in 2022, an increase of 40.0% on pre-COVID costs. 

For some categories the impact is heightened. According to WARC Media data, advertisers in the food category spent on average 79.8% of their budgets on TV in 2019, and in the automotive category, 67.7%. If they were to have maintained that same level of investment, by 2021 the volume of impressions would have decreased by 18 percentage points. 

Digital media costs are increasing too 

This twin trend of declining linear television viewership and rising TV media costs is encouraging advertisers to look elsewhere for incremental reach, but price pressure is being felt across the online media landscape. 

Paid social CPMs increased by 33% between 2019 and 2021 (source: Skai) and the growing popularity of retail media formats is pushing up the cost of advertising on platforms like Amazon. 

Channels such as broadcaster video on-demand (BVOD) provide an alternative source of incremental reach. However, over-the-top (OTT or streamed video) ad costs are rising too: inflation in advanced TV formats in the US is forecast to reach 9.9% in 2022, as per World Federation of Advertisers (WFA) figures.

Relative bargains can still be found in channels like radio

The pursuit of incremental reach has generally focused on digital audio-visual channels, as they offer a more straightforward transition from television. In comparison, offline channels are often under-utilised, despite not having witnessed the same levels of price inflation since 2019.

In Australia, the cost of radio media in 2022 remains 1.1% below pre-pandemic levels, while prices in the US are largely unchanged three years on. 

A similar picture emerges in out-of-home (OOH), incorporating both static and digital panels: in the UK, outdoor ad prices are 3.1% lower than before COVID-19, while, in the US, OOH remains 5.8% cheaper than it was in 2019.

Key quote

“As the global economy teeters on the brink of an inflationary recession, media costs may experience further volatility. Nonetheless, non-video channels are worth consideration if they are right for the audience” – Alex Brownsell, Head of Content, WARC Media.

*Global Ad Trends is a bi-monthly report which draws on WARC’s dataset of advertising and media intelligence to take a holistic view on current industry developments. A complimentary sample report of WARC Global Ad Trends: The rising cost of incremental reach is available here.

Sourced from WARC Media

TikTok micro-influencers boost APAC brands’ ROI: report

In a booming creator economy, micro-influencers on TikTok are an untapped opportunity for APAC brands, according to a report from social and media intelligence company Meltwater.

The Rise of the Creator Economy: A New Opportunity for Brands in Asia Pacific reveals that these social media users are emerging as brands’ top choice for collaboration.

Why it matters

Even as brands turn to celebrities for brand partnerships, micro-influencers with higher engagement and stronger connection to their audience can offer stronger ROI through hyperlocal marketing collaborations.

Key insights

• Some APAC brands have been successfully leveraging micro-influencers to connect with consumers and drive growth.
• In 2021, micro-influencers represented 91% of all sponsored post engagements, including likes, shares and comments, within APAC.
• The cost to engage micro-influencers in APAC versus famous influencers is lower, at an average US$200 per Instagram post.
• Such influencers see the strongest engagement rate on TikTok, with 32x/4x greater engagement than on Facebook/Instagram.
• APAC influencer population: Japan (600,000), Australia (400,000), Indonesia (400,000), Thailand (100,000), Singapore (70,000).

Quote

“Whether you call them influencers, content creators or key opinion leaders (KOLs), brands can benefit from tapping into the booming creator economy. An increasing number of consumers across Asia Pacific are turning to digital spaces and influencers to form their opinions and make purchase decisions” – Mimrah Mahmood, Senior Director and Partner, Meltwater Asia Pacific.

Background

The Meltwater report tracked and analysed the social profiles of over two million APAC-based content creators across Instagram, TikTok, Facebook, Twitter, YouTube and Pinterest from July 1, 2021 to June 30, 2022, combined with data from Meltwater’s social listening and media intelligence platform to generate insights into online conversations.