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What’s In Store For Media In 2023? Kantar Offers Some Clues.

The rising price of advertising, also known as media inflation, forced marketers to diversify their media plans in 2022. While that caused some to shift dollars into video on demand (VOD) as linear TV audiences migrated to streaming services, others began to view the 100-year-old radio medium as more attractive. “Less price sensitive media, such as radio, outdoor and sponsorship, are viewed as effective and cost-efficient brand building alternatives to television,” Kantar says in its Media Trends & Predictions 2023 report released Monday.

The World Federation of Advertisers forecasts advertising prices for advanced TV, which includes connected TV, streaming and VOD, will rise 10% in 2022 in the U.S. after a mere 3% increase in 2020. Paid CPMs (cost per thousand impressions) for social media platforms have also risen steeply since the start of the pandemic, up 33% between Q4 2019 and 2021.

As consumers are forced to pay more for everything, from groceries to entertainment, some plan to cut back on the number of paid streaming services they subscribe to. That’s making advertising-supported content more palatable, Kantar says.

But there is a worry that inflation could create two types of viewers: “those with less disposable income who become over-targeted by ads, and those with more disposable income, who are more attractive to advertisers, but are harder to reach,” Kantar says in the report. That’s causing marketers to rely more on the use of data and insights to optimize campaign planning and make budgets go further.

At the same time, marketers are preparing for a “post cookie” landscape in which the tracking cookies that underpin behavioral ad targeting on digital platforms are phased out due to consumer privacy concerns. While that may appear to be a bigger issue for digital behemoths like Google, Amazon and Facebook, a ripple effect is expected at broadcast media. The broadcast radio and television industry would lose $2.1 billion in digital advertising revenue annually, representing 6.3% of the industry’s total advertising revenue, if third-party cookies were eliminated today with no privacy-preserving alternatives, according to a study released last month by Borrell Associates.

This has marketers experimenting with targeting systems that don’t rely on tracking cookies. They’re also becoming more interested in contextual advertising, which targets potential customers based on the content of the program or webpage they’re viewing, along with location or weather. While media companies that have collected a significant amount of data about their consumers will be able to use that for ad targeting, Kantar says wider cross-platform targeting has hit a wall. “There will be incremental improvement in the coming years, but the hyper-targeted ecosystem the internet once promised looks increasingly unviable and initial assumptions about the granularity of targeting outside closed ecosystems may have to be reappraised,” according to the report.

Other major themes in Kantar’s report:

Technology: supercharging media plans and consumer experiences

Next year is set to deliver a host of new technologies, each brimming with potential – but it’s important not to get lost in the hype, Kantar warns. For example, dynamic product placement, which enables a product, billboard or screen featured in content to be substituted or overlaid with a different brand or advertisement, is growing. With the right data, users can be shown tailored product placement ads. But such technological possibilities “will need to be balanced against what’s acceptable to audiences,” Kantar says. In other words, if the product placement is outdated, jarring or out of place, it could turn off the audience.

The road to net zero

Reducing the carbon impact of media and advertising to net zero has become a top priority in many circles. Look for heightened efforts from the media and advertising communities to achieve “sustainable innovation.” That could involve brands offering green products and services, media owners offering more energy-efficient services, or agencies rethinking how their strategies are impacting the climate.

Splintered visions: the future of viewing

The winners in the streaming wars will deploy hybrid strategies that balance video on demand (VOD) and linear content, Kantar says. “Broadcasters are adopting aspects of VOD strategy that fit their positioning whilst preserving their points of difference, and VOD platforms are adopting concepts like ‘appointment TV’ and curated content discovery,” the report says.

Download Kantar’s “Media Trends & Predictions 2023” report HERE.

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