The UK is currently battling inflationary pressures due to the number of macro-economic challenges it has faced in 2022. In consideration of Britain’s vicinity to the war in Ukraine, continued Brexit related cost impacts on businesses and consumers, energy price concerns, government instability, the sad passing of Queen Elizabeth II and a very weak pound, continuous interest rate hikes from the BoE were attempts to control things. This all makes for an interesting perspective from which to predict just how the media market will shape up for 2023.
Whilst the media market does not always directly correlate with price pressures on the cost of media, operating cost impacts on many channels and a weaker revenue growth than anticipated last year will be directly contributing to forecast inflation in 2023. Whilst revenue projections overall are fairly flat for 2023 at present, there are still expectations for returns to healthy growth in Digital and a continued climb back to previous levels for OOH and Cinema.
The good news is that no huge waves of panic currently threaten 2023, but for a general recessionary climate that, optimistically, we feel the government will moderate to uphold some form of stability. We have the notable addition in our calendars of the King’s Coronation to lighten the moods of the nation in May, which we expect advertisers to recognise as an opportunity.
2022 had a uniquely placed Men’s FIFA World Cup disrupting the festive period, which 2023 replaces with a Rugby World Cup across September and October as the only notable male sporting addition to the calendar. With the Women’s FIFA World Cup in Australia and New Zealand delivering early morning kick-offs in the UK due to the time difference, the level of impact on any live broadcast media is potentially lessened – with advertisers likely to seek out news-brands and catch-up services to keep track of the tournament.
Outside of these events, we have no direct pandemic related concerns to note (currently) – with the cost-of-living crisis remaining the main topic of concern. Having weathered the experience through 2022, we are confident that opportunities for business to invest smartly will continue in 2023.
Some sectors will feel the deeper impacts of the economic headwinds in 2023, yet the outlook from industry bodies WARC/AA is to expect a 4% increase in total advertiser spend in 2023, which offers the market a decent shot of confidence as we all kick off plans for the year.
At the7stars, we’re predicting single-figure levels of inflation across all channels excluding Print (-2%), with TV, OOH and Digital Video at 8%, Radio at 6%, Digital Display at 4% and BVOD at 1%. Clearly, increases will be far less than those we’ve all suffered as consumers. We know these cost challenges can be mitigated with clever audience planning, strong creative for each channel and audience, and by aligning with the most trusted, relevant media partners through 2023. We look forward to supporting our clients with these goals in every capacity.