ECI’s annual media Inflation Report, published in the first quarter, pegs the global inflation rate for radio at 2.9%, compared to an overall rate of 5.2%, although higher for North America, at 6.2%. Compared to other media, radio advertising’s average price increase is lower than TV's 9.4%, online video's 6.2% or out-of-home's 3.4%, while at the same level as online display (2.8%) and above print media such as newspapers (0.7%) and magazines (-0.6%).
Compared to 2021, ECI estimates inflation is higher for radio, TV, online video and out-of-home, while lower for online display, with a continuing deflationary trend for print. TV's inflation rise is the greatest for 2022, which ECI's report explains is due to the midterm elections, as well as vendors shifting content to their streaming platforms, hence decreasing supply of traditional linear TV and pushing up prices.
Overall, global media inflation is up from ECI's 4.5% forecast at the beginning of 2022. “Many economists expect that economic growth will slow in 2023, but can’t agree whether it will remain just above growth, or if it will fall into negative growth, plunging the world into a recession,” its report says.
Addressing media advertising amid inflationary times, ECI's report notes, “With consumers reducing their spend, many brands will also look to reduce theirs. This will create a drop in demand for media, which could in turn reduce media pricing, thereby reversing the increased media inflation we are seeing this year. One of the most effective ways for brands to create value is by renegotiating agency contracts and/or conduct agency pitches for marketing services, including media, creative and production.”