Analyze, have interaction, and affect your viewers with Meltwater’s data-rich suite of social and media intelligence options. Greater than 27,000 organizations world wide use Meltwater to make higher enterprise choices quicker. Find out how at meltwater.com.
Episode Transcript:
Marcus Johnson:
Hey, gang. It is Thursday, March sixteenth. To all our listeners, welcome to Behind the Numbers Each day, an eMarketer podcast made doable by Meltwater. I’m Marcus. And right this moment, I am joined by certainly one of our principal analysts who heads up our digital promoting and media follow primarily based out of New York. From New Jersey, he is from all over the place, women and gents, it is Paul Verna.
Paul Verna:
Nice to be right here, and blissful that we acquired by the Ides of March once more.
Marcus Johnson:
Simply, solely simply. Immediately’s details, what’s the nationwide animal of Canada? Any guesses, Paul? It isn’t what you suppose.
Paul Verna:
So it is not a bear, or-
Marcus Johnson:
Oh, I did not suppose bear, however no. Not what I believe, I ought to say.
Paul Verna:
It isn’t a husky?
Marcus Johnson:
Mm-mm. Good guess. It is a beaver.
Paul Verna:
what? I used to be going to say beaver and I did not.
Marcus Johnson:
Oh, sorry.
Paul Verna:
I ought to’ve. Ought to’ve gone with my first intuition. And I do not know why, I used to be considering that. I imply, I suppose they’re all over the place within the Northeast or within the North, however…
Marcus Johnson:
Yeah, so the commerce of beaver pelts proved so worthwhile, many Canadians felt compelled to pay tribute to the buck-toothed animal. So William Alexander, who was granted title to Nova Scotia in 1621, was the primary to incorporate the beaver in a coat of arms. And the beaver was chosen because the nationwide image due to its significance to the fur commerce and financial development within the nation.
Paul Verna:
Rattling.
Marcus Johnson:
Yeah. I’d’ve thought moose.
Paul Verna:
That is proper. Yeah.
Marcus Johnson:
I am doing the moose ears proper now.
Paul Verna:
I see you, I see you.
Marcus Johnson:
It seems loads like a moose once you do the palms.
Paul Verna:
It is unmistakable. Should you did that and I did not know otherwise you hadn’t stated it, I’d say moose.
Marcus Johnson:
If we had been on a charades group, we might wreck it.
Paul Verna:
Completely. Yeah.
Marcus Johnson:
If it was moose. If it was anything, we would most likely do terribly. Anyway, right this moment’s actual matter, the digital advert world. How’s that going?
In right this moment’s episode, we first cowl the digital promoting world. We’ll examine in on that universe. After which for In Different Information, we’ll focus on manufacturers backing ladies’s sports activities and what number of Individuals nonetheless have cable. We’ll begin, Paul, speaking in regards to the digital advert house. So, the US advert market falls for the seventh consecutive month in January, notes Joe Mandese of MediaPost. Referencing the US Advert Market Tracker, a collaboration between Commonplace Media Index and MediaPost, the US advert market fell 6% in January.
That is the third worst determine of the seven adverse months again to again to again to again to again to again. I do not know what number of I’ve carried out, however months. Paul, the primary month-to-month dip was in July, and that was July of final yr when the US advert market fell 8%. It improved in August, September and October, but it surely was nonetheless adverse. Went from adverse eight to adverse one-ish, two-ish. After which from November to January, it acquired worse. It was adverse six, adverse 12, adverse six. What’s your tackle these month-to-month US advert spending numbers?
Paul Verna:
Effectively, I believe they replicate what we have all seen, is that the second half of 2022 was notably onerous on the advert market, particularly on social media corporations. However I believe it is also necessary to place these numbers in perspective, and we have actually had a really anomalous few years right here, beginning with the pandemic and every thing that occurred within the rapid aftermath. After which the surprising, not less than on the time, surprising surge in promoting in 2021, adopted by then this quasi-meltdown in social media specifically. So, issues have been haywire, and you then add all of the unknowns just like the economic system and the battle and Twitter having its second. So it is actually onerous, in that context, to check January of 1 yr to January of the earlier yr.
Marcus Johnson:
Yeah.
Paul Verna:
However should you return two years, January of 2023 was really up 15% over 2021.
Marcus Johnson:
Attention-grabbing.
Paul Verna:
So, should you take that longer view, I believe that is a bit of bit extra indicative of how issues are trending. I believe to have a look at January, it is basically a continuation of that second half doldrums that we had final yr. We have not absolutely recovered, however I believe there are some indicators of optimism and a way that the market is headed towards a greater yr this yr on many ranges than final yr. However I believe it should take a short while to get there.
Marcus Johnson:
Yeah, it has been some robust comps. That is an ideal level. Let’s discuss… Effectively, I’ll come again to the costs in a second, however let’s discuss Q2, what we will anticipate within the coming quarter, coming months. Kristina Monllos of Digiday writes that “Entrepreneurs are spending, and there are indicators it may choose up in H2 as a result of company executives see extra new enterprise pitches taking place now. ‘Cautious optimism’ appears to be a well-liked phrase when summing up entrepreneurs’ present temper. Nevertheless, spending is down round 10% versus Q2 of final yr as entrepreneurs maintain onto {dollars} longer and search extra flexibility slightly than long run commitments,” Miss Monllos notes. Paul, what do you anticipate Q2 to appear to be?
Paul Verna:
I’d agree with that evaluation. I believe there’s a cautious optimism, but it surely’s tempered by this recurrence of unknowns. And now, we have now this sudden financial institution disaster which was on no person’s radar even three days in the past or per week in the past, and now immediately that is injecting loads of uncertainty into the market. These sorts of issues make folks nervous. There’s nonetheless some sense that we do not fairly know the place a few of these social media corporations will land when it comes to…
I imply, I discussed what’s taking place at Twitter, however should you have a look at TikTok and the potential rules on the horizon for them, there’s simply a lot inflow out there that issues may tip somehow fairly simply. However general, I believe once you survey entrepreneurs and companies and even shoppers, I do not suppose persons are strolling round with a dismal sense that the underside is falling out of something. I believe it is actually only a restoration that also has to undergo these pace bumps, but it surely appears to be headed in the fitting route.
Marcus Johnson:
Yeah. Silicon Valley Financial institution, in fact, the financial institution that Paul is referencing that collapsed simply final week. So, Paul, most indicators appear to be pointing to a softening advert market that can choose up. There’s loads of noise on the market, and it is onerous to search out the sign for the noise. However a couple of factors right here that means that issues will choose up, that issues that are not nice in the intervening time will choose up. In December, we lowered our 2023 digital advert spending forecast by $5 billion, citing inflationary pressures and the continued addressability points in digital promoting as the primary causes. 5 billion feels like an enormous downward revision, but it surely’s simply 2%. So we took the whole and we revised it down by 2.2%.
Second level right here, Daniel Konstantinovic, who’s certainly one of our briefings analysts, was noting that advert execs have expressed optimism in regards to the market coming into this yr. 84% of oldsters in December in an advertiser notion survey stated they do not plan to chop budgets in 2023. 30% stated they are going up. 54% stated they’d stay unchanged. Then a World Federation of Advertisers survey, third level right here, it was a survey of 43 multinational corporations, discovered solely 30% are chopping budgets this yr, with most citing the financial downturn. After which lastly, a Digiday piece was noting that in accordance with new analysis from buyer engagement platform firm Braze, regardless of the financial uncertainty, 90% of surveyed manufacturers will enhance advertising and marketing budgets within the subsequent 12 months.
Clearly, that is not simply Q2. That is looking a bit of bit additional. However Paul, most indicators appear to be fairly constructive when it comes to what we will anticipate. And one of many figures we must always notice right here, so digital advert spending and what do we have now for complete digital advert spending for this yr, we nonetheless forecast it to be $280 billion, which might be 12% development. And mainly three quarters of all media advert spending now going in direction of digital within the US. The very last thing I need to notice right here when it comes to what we’re anticipating for digital advert spend, $280 billion. Now, that was for US digital advert spend this yr. That was revised down by the 2 factors that I discussed, or by $5 billion from a couple of months in the past once we checked out this determine. Nevertheless, once you zoom out, you discover that the pandemic added about, what are we taking a look at right here, like 70, 80 billion {dollars}?
Yeah, about 60, 70 billion {dollars} to what we had been anticipating. So once we forecast what 2023 was going to appear to be earlier than the pandemic occurred, the month earlier than, we thought 2023 was going to have about 215 billion. Now, it really has about 280 billion. So Paul, to your earlier level about these month-to-month numbers, you have to zoom out. And I believe with this as effectively, it is positively the case the place you zoom out and also you have a look at the true image when it comes to how advert spending is performing, not simply in comparison with the present bumps within the street, however in comparison with how issues had been wanting. It is fairly spectacular. It is nonetheless in actually fine condition.
Paul Verna:
Yeah, and I believe we have seen that throughout the board with loads of our forecasts, the place we, for each forecast replace, beginning with the pandemic, we discovered ourselves really elevating the forecasts past the place they had been. So yeah, basically once you exit a couple of years put up, say, early 2020, many of the digital advert markets have much more quantity in them than we had been anticipating them to have at the moment. So you could possibly say that in a common sense, the forecasts have mainly outpaced our personal expectations. What we did now was we made a downward revision, however once more, let’s focus on the context. It is a very small downward revision after a complete sequence of twice a yr, typically thrice a yr, considerably upward revisions.
I imply, I do know that is type of presenting a glass half-full image, and if you’re an organization that is battling layoffs or with decrease income or with not with the ability to attain your viewers due to focusing on points, I do not need to decrease the draw back of what is taking place and I do not need to decrease the influence of that downward revision. However general, I believe it’s a basically wholesome market that, like all markets, has to undergo some ups and downs, however general the curve goes in the fitting route.
Marcus Johnson:
A market that also accounts for 75% of complete media advert spending, that is digital. So digital advert spending accounts for 75% of the whole advert spending pie, the whole advert spending pie being $370 billion within the US, 370 this yr. That’ll nonetheless be up 7% from final yr’s 10%. So nonetheless respectable development there as effectively, all issues thought of
Paul Verna:
Proper. And that 75% you talked about that digital makes up of the entire, that is going to go as much as 80% inside three years.
Marcus Johnson:
That is staggering. And it was about 55% earlier than the pandemic. 2019, digital accounted for 55 and now’s at 75. And to Paul’s level, it should get to 80 very quickly. Paul, let’s speak some costs actually fast. So, advert value inflation is slowing, in accordance with ECI Media Administration, however the hassle is much from over. Our briefings analyst I discussed earlier, Daniel Konstantinovic, he notes that the US will see advert value inflation fall almost two factors to 4% this yr. Fall almost two factors to 4% this yr, that is advert value inflation. TV will account for many of the decrease inflation, falling to 7% from close to 13 final yr per ECI. However Paul, zooming out even additional, what’s your tackle how advert costs look in comparison with pre-pandemic ranges?
Paul Verna:
Effectively, I believe this can be a case the place the satan is within the particulars. And should you have a look at an general determine for all of promoting, it would not actually let you know what you want to know as a result of, sure, TV costs are falling greater than different costs. In order that’s one thing that I believe most of us would naturally assume primarily based on how tv is trending. However once more, should you’re an advertiser together with your budgets primarily in digital, then perhaps that decreasing of inflation shouldn’t be fairly as important and also you really do need to take care of some fairly hefty costs. So it is actually a case by case foundation. It is positively constructive that that inflation index general goes down, and I believe that displays the US economic system at massive. However there’s simply a lot extra to those metrics once you begin drilling down on the numerous, many several types of promoting which might be a part of the ecosystem now.
Marcus Johnson:
Yeah, in accordance with WAC, worldwide advert costs did not actually drop in 2020. Costs for newspaper, magazines, out-of-home and show had been all down roughly a couple of factors. TV was really up 4 factors. Immediately, newspaper and magazines value per one thousand’s up about two to 4 factors worldwide. That is newspapers and magazines, out-of-home show and radio up 5 to seven factors, and TV is up 20%. That is from WAC, taking a look at worldwide advert costs. Talking of worldwide, Paul, Daniel goes on to jot down, “A tender economic system, continued inflation and provide chain points imply 2023’s tepid promoting outlook is about to proceed. World advertising and marketing and promoting spending will develop simply over 5% this yr down from slightly below 8% final yr, per PQ media’s tenth annual international advertising and marketing and promoting spending forecast.” However Paul, what’s our international outlook on 2023 advert spend?
Paul Verna:
So, our outlook for worldwide advert spending development in 2023 is of slightly below 7%. So it is increased than PQ media at 5.3%. We anticipate that development really accelerating in 2024 to simply over 8% and the market crossing the $1 trillion threshold at that time. So yeah, our outlook is considerably higher, however I imply, not fully in a unique ballpark. And once more, I believe topic to fluctuations as issues occur that no person expects.
Marcus Johnson:
Yeah. 7%, as Paul talked about, this yr when it comes to worldwide complete media advert spending, after which yeah, 5% final yr, Paul. So we expect it should do higher this yr than it did final yr and higher subsequent yr than it is going to do that yr, so persevering with to speed up. Last query right here, Paul, we’re specializing in digital for a second. Michael Eslamboli of Forbes lately wrote about 5 predictions for digital advertising and marketing this yr. A resurgence of contextual adverts, extra entrepreneurs utilizing visible search and a few others. However Paul, what’s a prediction not on this checklist that you just anticipate to develop?
Paul Verna:
I believe usually phrases, advertisers are increasingly fascinated by performance-based KPIs. And once they have a look at issues like CTV and retail media, that are the 2 quickest rising advert codecs that we observe, an enormous a part of the draw there’s the flexibility to measure ROI. So it is to not say that brand-oriented promoting goes to go away in any means, form, or type, however I simply hear increasingly that individuals need to know what these outcomes are. And that is a prediction that if I had been taking a look at how the market goes to unfold this yr or subsequent yr, that may be on my checklist.
Marcus Johnson:
Wonderful. That is all we have time for the lead. Time now for the halftime report. Paul, we’ll take a fast ten-second takeaway from you from the primary half.
Paul Verna:
So, there are predictable unknowns and unpredictable unknowns. The Apple privateness reset, inflation, rates of interest, all these issues are slow-moving trains. And though they catch folks off guard, they are often deliberate towards. After which you have got issues like I discussed earlier, the financial institution state of affairs, the Twitter meltdown. These are fully out of the blue. And I believe we dwell in a world the place we simply need to account for a few of that simply off-the-wall type of stuff that no person can predict.
Marcus Johnson:
Yeah. Effectively, that’s all we have now time for, for the primary half. Time for the second. Immediately in different information, a coalition of manufacturers backing ladies’s sports activities and the way many individuals in America nonetheless have cable?
Story one. “Coca-Cola and Morgan Stanley be part of the coalition of manufacturers backing ladies’s sports activities,” writes, there he’s once more, Insider intelligence briefings analyst, Daniel Konstantinovic. He explains that “Market analysis firm Sports activities Innovation Lab, owned by former Olympian Angela Ruggiero, has shaped a coalition of manufacturers and sports activities leagues known as the Ladies’s Sports activities Membership to scale back obstacles to purchasing ladies’s sports activities advert stock and sponsorships. Companions embody Coca-Cola, Nike, Morgan Stanley, and leagues just like the Ladies’s Nationwide Basketball Affiliation, the WNBA, and Girls Skilled Golf Affiliation.” However Paul, essentially the most attention-grabbing sentence on this article is what and why?
Paul Verna:
Probably the most attention-grabbing a part of it to me is the entire hen and egg argument the place advocates for girls’s sports activities say that there aren’t sufficient alternatives for visibility and for advertising and marketing, and broadcasters and types say that the audiences and the curiosity will not be there to help the alternatives. Personally, I believe that anyone not capitalizing on ladies’s sports activities usually is lacking an enormous alternative.
And should you have a look at the expansion within the NCAA March Insanity, the ladies’s facet, or the WNBA, or should you have a look at how ladies’s soccer overperforms males’s soccer within the US and the UK, these are locations the place there are positively extra alternatives. And even have a look at particular person sports activities, like Mikaela Shiffrin breaking the document for essentially the most World Cup wins of any Alpine skier in historical past. Otherwise you have a look at Serena Williams and her large footprint on the tennis world. So there are simply so many locations the place ladies’s sports activities are every thing that males’s sports activities are and extra. And I believe entrepreneurs and broadcasters ought to simply get on board.
Marcus Johnson:
Yeah, there was a couple of nice quotes on this article from Daniel. One in every of them was “The Ladies’s Sports activities Membership trying to make the most of manufacturers and sports activities leagues mixed affect to stress networks into giving ladies’s sports activities extra favorable slots. Progress is being made. The Nationwide Ladies’s Soccer League Championship, the NWSL, was given a primetime slot for the primary time ever final yr on CBS.”
After which Daniel additionally factors to ladies’s sports activities viewership being on the rise. “A November 2022 Samba TV research discovered Ladies’s March Insanity viewership had grown over 80%, eight zero year-on-year, 4 instances increased than males’s when it comes to development. WNBA finals grew over 170% versus 25% for males’s. And the NWSL championship grew almost 500%.” I appeared on the WNBA as effectively, and the common season viewership common near 400,000 viewers. That is up over 50% on pre-pandemic 2019. Additionally, shout out, Ladies’s World Cup coming at you this summer season. Come on, England, please. We won’t depend on the lads to deliver the championship again. I am sorry, guys, we simply cannot. So please, women.
Paul Verna:
Have we talked about who gained the lads’s World Cup [inaudible 00:20:31]?
Marcus Johnson:
Okay, transferring on. Shifting on. It was Argentina. Congratulations. Paul’s emailed me six instances this week.
Paul Verna:
That is it? The week is younger, although.
Marcus Johnson:
Sure, most of them now go to my spam folder. Story two, the US sheds almost 6 million pay TV subscribers in 2022, notes a latest Superior TV article. It cites findings from Leichtman Analysis Group, which present the biggest pay TV suppliers within the US, representing over 90% of the market, misplaced almost 6 million internet video subscribers, mainly cable of us, in 2022. That is 1 million greater than the close to 5 million misplaced the yr earlier than. So 5 million, after which in 2022 it was 6 million. I stated cable, they embody cable, satellite tv for pc and telco, but it surely’s what most individuals consider as once you subscribe to cable. Paul, essentially the most attention-grabbing sentence on this article is what and why?
Paul Verna:
It is the sentence that wasn’t within the article, and that’s that the proportion of US households that subscribe to conventional pay TV dropped beneath 50% for the primary time in 2022. So sure, all the stats within the article had been true and correct and indicative of a pattern that is not going to be reversed. However that tipping level of dropping beneath half, that is actually notable and that is one thing that we put out a press launch about. And Adweek wrote an article about it final week, so very attention-grabbing information that simply tells us what I believe we’re all seeing anecdotally.
Marcus Johnson:
Yeah. An enormous milestone and that pattern persevering with in that route. So, to Paul’s level, US households with cable fell beneath the 50% mark for the primary time final yr. Simply this yr, 46% of US households could have cable, so 4 factors down from that. After which by 2026, simply over a 3rd could have cable, that is 37%. And that’s all we have now time for. Thanks a lot, Paul, for hanging out right this moment.
Paul Verna:
At all times a pleasure.
Marcus Johnson:
Thanks, in fact, to Victoria, who edits the present, James, who copy edits it, and Stuart who runs the group. And due to everybody for listening in. If you wish to say hello, you’ll be able to DM us. Do folks say that? I do not.
Paul Verna:
You simply did.
Marcus Johnson:
You may direct message us.
Paul Verna:
You simply did. You are the agenda setter, Marcus. Should you say it, they are going to come.
Marcus Johnson:
Oh, I hope not. I hope they are not trying to me for pattern setting. Instagram message. If you wish to ship us an Instagram message, it is @BehindtheNumbers_podcast. See you guys tomorrow for the Behind Numbers Weekly Hear, the eMarketer podcast made doable by Meltwater. We acquired there, even with the moose ears. Simply put your palms up, open palms, high of your head. On the spot moose. See?
Paul Verna:
There you go.
Marcus Johnson:
It really works too effectively.
Paul Verna:
It really works each time.
Marcus Johnson:
That is my Halloween costume for subsequent yr. That is such a simple elevate.
Supply By https://www.insiderintelligence.com/content material/podcast-daily-how-digital-ad-world-faring-brands-backing-women-sports-how-many-folks-have-cable