Media Buying Briefing: The latest media agency estimates for 2023 revenue are out and they remain, well, upbeat
Most economic prognosticators will tell you 2023 is either going to be a tough start with a happy finish, or just a slog all the way through, as parts of the world battle deeper recessionary trends and others still find ways to grow.
Ask the major holding company media agency analysts — namely, GroupM and Magna — and they continue to hold a more positive, if slightly tempered outlook on 2023 given strong results for 2022 despite the fact that the long-term prognosis isn’t great.
“Despite recent headlines warning of a Big Tech bust and a digital advertising slump, we expect both forms of digital advertising [both pure-play digital and digital iterations of traditional media] to grow double digits in 2022,” wrote Kate Scott-Dawkins, global director of business intelligence at GroupM in the network’s latest report, out today.
GroupM revised its 2022 global advertising growth to 6.5% (excluding U.S. political ads), down from 8.4% it had forecast back in June. Scott-Dawkins attributed the drop primarily to tempered growth in China — taking China out of the equation, GroupM expects 2022 to end up at 8.1%.
As for 2023, GroupM predicts global advertising growth of 5.9%, and Scott-Dawkins attributed that to strength in connected TV, retail media and markets that remain fast-growing like India. Still that represents a drop from 6.4% which it predicted in June.
At IPG’s Magna unit, the revised forecast for global media revenue growth is 6.6% for 2022, down from 9.2% predicted back in June. And the 2023 outlook is also a bit tempered, revised from 6.3% growth globally to 4.8%. As with GroupM, Magna attributes much of the rollback to a reeling China, whose restrictive Covid policies and stringent digital regulations inhibited growth there.
“Ad spend is slowing slightly, but remains largely in line with our previous expectations,” said Luke Stillman, Magna’s senior vp and group director of global market intelligence.
(China factors in largely to the global picture since, together with the U.S. the two countries represent more than 55 percent of all ad spend, according to Scott-Dawkins.)
As would be expected, digital continues to generate the most growth, even after some of the major platforms hit potholes of one sort or another in 2022 — massive layoffs due to softer-than-expected revenue gains, greater scrutiny of TikTok from a governmental point of view and turmoil at Twitter under new ownership.
Magna predicts 8% growth in digital in 2023, or 65% of total ad revenue, driven by explosions in e-commerce and digital video primarily but with search staying steady and social recovering after some of the above-mentioned stumbles.
Perhaps the biggest surprise among all media is the expected growth rate of out of home media, which continues to enjoy faster growth ahead of all other media besides digital — and that’s due in part to its continued transformation to a digital medium. GroupM predicts OOH will grow 18.1% this year (excluding China), which is better than any traditional medium by far.
Likewise, Magna is calling for 12.4% growth this year in OOH, a bump up from 10.4% it had predicted in June.
That bullishness was echoed by the OOH industry’s trade organization, the Out-of-Home Advertising Association of America (OAAA), which released its third quarter 2022 revenue numbers this morning. The data shows the medium grew 25.7% year to date over 2021, and is on par with 2019 YTD revenue of $6.4 billion.
“Key sectors are increasingly investing more dollars — in particular, political spending in out of home hit record highs,” said Anna Bager, OAAA’s president/CEO. Other categories that contributed to the medium’s growth include: media/advertising and the rather broad public transportation, hotels and resorts. According to the OAAA, nearly a third of the medium’s top 100 advertisers doubled their ad spend in OOH.
Color by numbers
Data company Whip Media recently released consumer survey results on made-for-television holiday movies. More than 160 new holiday movies are slated for 2022, in addition to holiday classics people tend to rewatch during this time — so networks and streamers are battling it out for viewers. More below on Whip Media’s findings from the November study on more than 3,000 U.S. adults.
- Holiday movie consumers love, well, consuming holiday movies – 53% said they prioritize watching this content during the season. Hallmark, Netflix, Lifetime, Disney+ and Hulu were ranked as the top providers for holiday titles.
- Viewers are likely to watch a mix of new and old holiday movies. Just under three-fourths (74%) said they watch both types, while 17% said they watch just the latest holiday TV movies.
- It’s more of a solo experience than you might think – 71% of respondents noted they regularly watch these movies alone, while 51% saying they watch with their families. About 28% said they watch with their partner.
- More than half of viewers said they discovered a new holiday movie through ads or trailers (52%) or recommendations from a streaming service or device (51%). Additionally, 47% said they found new releases through social media. — Antoinette Siu
Takeoff & landing
- In the latest sign that there’s a movement afoot to rebundle media and creative, Beacon Media Group and creative shop Flint & Steel struck an alliance to jointly go to market with expanded services for clients.
- Independent agency Hanson Dodge hired Maggie Pope as its associate media director, adding to its in-house media capabilities under vp and group director of media and activation Michelle Millar.
- Media Disco is a new platform launched by two ex-Carat strategy execs, James Allen and Joey Medici, that aims to offer a marketplace for media companies and advertisers to connect. The free platform claims to have 70 media partners and 60 advertisers.
“A lot of organizations discount how difficult this business is. Take Netflix and Microsoft. Microsoft is a very poor sales organization [for Netflix to have chosen]. And it’s reflective of them trying to jump into this kind of quasi-upfront type of marketplace. They don’t have the relationships as deep as Google or NBC [which were rumored to be possible partners with Netflix] would have had. It would have been seamless out of the gate.”— head of investment at an independent media agency.
- I wrote about the rise of PMG from a relatively unknown independent media agency to the shop that landed media AOR duties for Nike in North America.
- Digiday’s gaming and esports reporter Alexander Lee caught up with Dentsu’s new global head of gaming, Brent Koning, who comes to the role with considerable experience in both agencies and the gaming world.
- Digiday’s media agency reporter Antoinette Siu looked at the challenges purpose-driven advertising faces as recessionary winds pick up. Could podcasting provide some shelter?
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