Media inflation unlikely to be tamed in APAC
Rampant media inflation across the Asia Pacific (APAC) region shows no sign of easing despite the heat coming off global inflation, according to a new report.
APAC media inflation showing no signs of stopping / Image by Jason Goh from Pixabay
Data compiled by ECI Media Management shows that while global media inflation for 2023 at 4.4% is likely to come in lower than the 5.2% rate recorded last year the same cannot be said for APAC countries, where collective inflation will rise from 3.8% in 2022 to 4% this year.
If born out by reality the numbers would see the region stand out as a global outlier as the only territory to experience a rise in media inflation, driven upwards by categories such as online video which is expected to edge higher at 4.5%.
Costs in other categories are also expected to move higher with online display up 4%, out-of-home rising by 3.3%, radio increasing by 2.2% and newspapers up 2.1%. Only the struggling magazine sector is likely to decline (by -0.2%), while TV inflation is expected to come in at 4.3% in 2023 - a decrease from the 6.2% registered in 2022.
Internationally TV has extended its run as a source of the highest inflation rates at 6.8%, albeit at its lowest level of increase in three years, tentatively suggesting that global inflation is beginning to moderate. Although this may simply be attributed to fewer major sports and political events in 2023.
Fredrik Kinge, the global CEO of ECI Media Management, commented: “Media prices continue to rise across the world, yet, aside from the APAC region, global media inflation is slower than over the last few turbulent years. TV in particular is set to inflate more slowly, raising questions about whether TV pricing is starting to stagnate. This could be driven by advertisers shifting TV budgets into CTV, or by the fact that this will be a quiet year in terms of sports and other major events that drive eyeballs to TV.
“With a global recession seemingly all but inevitable in 2023, this is not an easy context in which to operate for brands, as consumers tighten belts, and energy and supply chain costs continue to rise. However, there is a strong case to resist the impulse to reduce media investment, as well as ample evidence that brands who continue to invest in longer-term brand-building activity enjoy stronger growth during the recovery and beyond.”
Globally Latin America is experiencing the highest rate of media inflation by a significant margin at 8.4%, followed by EMEA at 4.9% and North America at 4.2%.
Across the world, online video is forecast for 5.1% inflation, ahead of OOH (3.8%), radio (3.2%), online display (2.8%), newspapers (1.7%) and magazines (0.8%). Interestingly this is the first time in several years that print has grown.