
Global TV media costs surge almost a third post-pandemic
Media inflation is driving up the cost of advertising across channels, with TV most affected, according to an analysis by WARC Media.
TV costs are rising fast
The latest Global Ad Trends* report, The rising cost of incremental reach, finds that, globally, TV CPMs (cost per thousand) have increased 31.2% since 2019 – the steepest incline in more than two decades – and are up 9.9% year-on-year in 2022.
The trend is especially pronounced in the US, where TV CPMs are forecast to reach $73.14 in 2022, an increase of 40.0% on pre-COVID costs.
For some categories the impact is heightened. According to WARC Media data, advertisers in the food category spent on average 79.8% of their budgets on TV in 2019, and in the automotive category, 67.7%. If they were to have maintained that same level of investment, by 2021 the volume of impressions would have decreased by 18 percentage points.
Digital media costs are increasing too
This twin trend of declining linear television viewership and rising TV media costs is encouraging advertisers to look elsewhere for incremental reach, but price pressure is being felt across the online media landscape.
Paid social CPMs increased by 33% between 2019 and 2021 (source: Skai) and the growing popularity of retail media formats is pushing up the cost of advertising on platforms like Amazon.
Channels such as broadcaster video on-demand (BVOD) provide an alternative source of incremental reach. However, over-the-top (OTT or streamed video) ad costs are rising too: inflation in advanced TV formats in the US is forecast to reach 9.9% in 2022, as per World Federation of Advertisers (WFA) figures.
Relative bargains can still be found in channels like radio
The pursuit of incremental reach has generally focused on digital audio-visual channels, as they offer a more straightforward transition from television. In comparison, offline channels are often under-utilised, despite not having witnessed the same levels of price inflation since 2019.
In Australia, the cost of radio media in 2022 remains 1.1% below pre-pandemic levels, while prices in the US are largely unchanged three years on.
A similar picture emerges in out-of-home (OOH), incorporating both static and digital panels: in the UK, outdoor ad prices are 3.1% lower than before COVID-19, while, in the US, OOH remains 5.8% cheaper than it was in 2019.
Key quote
“As the global economy teeters on the brink of an inflationary recession, media costs may experience further volatility. Nonetheless, non-video channels are worth consideration if they are right for the audience” – Alex Brownsell, Head of Content, WARC Media.
*Global Ad Trends is a bi-monthly report which draws on WARC’s dataset of advertising and media intelligence to take a holistic view on current industry developments. A complimentary sample report of WARC Global Ad Trends: The rising cost of incremental reach is available here.
Sourced from WARC Media

E-commerce slows in Japan
E-commerce in Japan saw a surge between 2019 and 2021 but growth has since tailed off, partly as the necessity to shop online has receded, partly because the sector is experiencing delivery problems.
Context
Even before the pandemic, Japanese consumers shopped online much less than those in other nations, and, even with that lockdown surge, they still lag; for example, they shop online for daily essentials about 40% less than the average according to research by Statista.
Why it matters
Now, as consumers tire of shopping on smartphones and sales through brick and mortar stores pick up post-pandemic, there is an opportunity to reignite growth by expanding the role of physical stores in e-commerce. The Financial Times reports examples of clothes retailers seeing increased sales from adding new outlets just to allow consumers to see and try on items they’ve seen online.
Takeaways
- Depending on the source, from 2019 to 2021 e-commerce grew between 20% (Nowcast & JCB) and 30% (Ministry of Internal Affairs and Communications).
- From January 2020 to April 2022, purchase prices rose in 70% of categories on online platforms Amazon, Rakuten and Yahoo, according to research company Nint.
- A shortage of delivery workers has prompted some groups to trial the use of self-driving robots to deliver fresh food and boxed meals.
Sourced from Financial Times

Mental availability uplift from OOH creative with distinctive brand codes: study
Out-of-home (OOH) creative incorporating distinctive brand codes – including logo, colour, shape, tone of voice and style of imagery – averaged a 13% uplift in category mental availability versus weakly coded ads, according to research by media company JCDecaux New Zealand.
Why it matters
Using distinctive brand codes in OOH creative influences mental availability, which predicts the propensity for a brand to come to mind in a buying situation versus simply being known.
Key insights
- Mental availability is an important brand metric and is often undermeasured compared with awareness or consideration.
- Ads with strong brand codes are liked 31% more than weakly coded ads.
- Liked ads drive uplifts by 18% as strongly coded ads are easier to cognitively process, which leads to perceived preference.
Quote
“At JCDecaux, we subscribe to the view that advertising ‘works’ through building memory structures that consumers call on in a buying situation. This study puts specific numbers around our knowledge that strongly coded out-of-home advertising can influence decision making and drive a sales effect” – Victoria Parsons, Senior Insights and Strategy Specialist, JCDecaux New Zealand.
Background
The study was conducted in partnership with behavioural insights company NeuroSpot and involved 1,600 participants, who were shown real campaign creative across five categories: automotive, banking, FMCG, energy and alcoholic beverages (beer).

iHeartMedia believes wide customer base can help in soft ad market
iHeartMedia, a leading player in the US audio space, believes its wide customer base and diversified operations will be sources of strength if the ad market enters a challenging period.
The background
- Bob Pittman, iHeartMedia’s CEO, noted on an earrings call that it was originally hoped that 2022 would be a “robust advertising year” for the industry.
- However, the Russian invasion of Ukraine, and “secondary effects” like burgeoning inflation, have caused significant macroeconomic uncertainty.
- In response, many industry-watchers have expressed concerns that advertisers may soon cut back their outlay.
Mapping expenditure trends
- Looking at current expenditure patterns, iHeartMedia has noted a particular rhythm in activity on the part of advertisers.
- “We have seen a trend that we see more softness for the first month of the quarter than we do the other two months of the quarter,” Pittman said.
- “Our thesis is that in times of uncertainty, [in the] first month of the quarter, everybody takes a beat and waits and looks and then continues to spend in the other months.”
Strength in diversity
- Pittman reminded investors that iHeartMedia currently has “tens of thousands of advertisers”.
- Such a diverse slate of ad clients means there are likely to always be pockets of robust ad expenditure even if other parts of the market are “softer” in challenging times.
- “We've got no advertising category that's over 5% of our revenue [and] no single advertiser over 2%. So we have a remarkable diversity here,” Pittman said.
The advantages of audio
- Radio, Pittman continued, is “the least expensive medium with the largest reach”, meaning it has a compelling value proposition for advertisers.
- Diversification is also a source of strength for iHeartMedia, with digital more important in the mix, today delivering 26% of revenue, versus 12% in the first quarter of 2020.
- Even in the “major advertising downturn” of 2020, iHeartMedia’s digital revenues climbed by 26%, including a 91% lift for podcasts.
- “We feel the increased relative size of our digital and podcasting businesses … puts us in a stronger and more resilient position than we’ve ever been in to weather any advertising downturns,” Pittman said.
Final thought
“Advertisers who’ve lived through challenging economic times like these know that materially cutting back their marketing today will result in them losing sales over the long term. Instead of pulling back entirely during times of uncertainty, these marketers often look for more efficient means of engaging with their customer base” – Bob Pittman, CEO, iHeartMedia.

Roblox results reflect tough environment and a need for advertising
Roblox, the gaming and creation platform, has had another tricky quarter as overall revenue and user increases couldn’t make up for a dip in the critical “bookings” metric.
Why it matters
Roblox is the closest platform to a functioning metaverse (despite not being interoperable with other platforms) in which users can move between virtual experiences with an economic layer that binds it.
This is where bookings come in, as they cover what users have spent on Roblox’s virtual currency, Robux. As such, in previous earnings seasons WARC has explored the firm’s results from the perspective of consumer will to spend money on virtual items at a time of heightened interest in the metaverse.
Roblox has also been interesting from a brand perspective, as the company continues to entice investors with details of a self-service brand offer.
By the numbers
While the markets have reacted badly to a dip in bookings, it’s part of a wider slowdown in video gaming, which had naturally seen a huge boost during lockdowns when lots of gamers had nothing else to do. More recently, a more general dip in discretionary spending in the face of inflation has also affected the company.
Ahead of its earnings call, the company told the markets the following highlights for Q2 (all year-on-year):
- Revenue up 30% to $591.2m
- Bookings down 4% to $639.9m
- DAUs (daily active users) up 21% to 52.2m
- Hours engaged were up 16%.
- Bookings per DAU were down 21% to $12.25
While there is still a serious business in the economy of virtual currency and goods that the bookings signify, the many engaged users who are playing but not necessarily spending suggest a serious opportunity in advertising.
How advertising is going
Following the company’s explanation of validated brand accounts and boosted experiences in May (full details here) David Baszucki, Roblox chief executive outlined the investment going into the project:
“The product direction for this advertising system will also be self-service, but it will be complemented by our amazing brands. We have a great team. It's scaling. We have amazing people who are working with the Gucci and the Tommy Hilfiger […] in this new form of advertising to the platform,” he told investors.
“We expect to continue building this amazing brand team. It will not be a sales team, it will be a consultative team to help people who are doing self-service and exploring our platform.”
He added that Roblox will be “testing our immersive advertising system sometime this year, we believe.”
A development flywheel
Part of the self-service ideal would mean brands seeking out experienced developers without even necessarily going through Roblox by using its talent hub – “that's the dynamic that we want to see, and as that demand comes from brands that will spur on more developers,” explained CFO Mike Guthrie, adding: “I wouldn't be surprised to see agencies off of it as well.”
Sourced from BusinessWire, Motley Fool, WARC