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Forecast says digital big ad winner 2023

Digital will be big winner 2023 when marketing budgets under pressure

Three quarters of advertisers and marketers agree that next year budgets are under heavy  scrutiny with marketers required to justify investment. 29% in a survey by World Federation of Advertisers plan to decrease spend in 2023. The same proportion claim they will invest more next year. 4 in 10 say  they will maintain their budgets at 2022 levels.

The report says the big winner will be digital, with 42% saying they will increase spend either slightly or significantly, with offline media such as TV, radio, print, and outdoor likely to suffer. Nearly half of respondents are planning to cut offline investment and a quarter are looking to make a significant cut (of more than 10%) in print spend.

Three quarters of the sample “agree strongly” or “agree” that 2023 budgets are under heavy scrutiny, with marketers required to justify investment.

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The study, conducted together with media investment analysis firm Ebiquity comprises 43 multinational companies. The sample included 5 of the world’s top 10 advertisers by spend, which collectively invest more than USD 44bn in advertising, WFA says.

“There is more evidence of a potential cut in spend in EMEA compared with APAC. In EMEA, for example, a third of respondents agree there could be a significant (more than 10%) or slight decrease (0-10%) next year, compared to 30% who are planning a slight increase in spend. By contrast, in Asia Pacific just 15% envisage a slight decrease while 35% plan a slight increase.!

WFA says the big change in behaviour is a different emphasis in the way that money will be allocated next year, with greater emphasis on short-term, performance marketing. 28% of respondents say they will seek to boost performance, compared to 21% who are focused on increased brand spend in 2023.

“The other major change is the move towards more flexibility in investment. This means greater use of biddable/auction-based platforms, a long-term change in the way media is bought particularly on digital channels. This approach also allows brands to hold back funds, should the economic conditions dictate. Fewer than 1 in 10 respondents (9%) are planning to increase the proportion of budget allocated to upfront commitments.”

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“It is encouraging to see that a number of clients are planning on standing firm and taking heed of the well-taught lessons from previous recessions, which show time and again that those who continue to invest or increase their ad spending emerge stronger from periods of economic uncertainty,” says Stephan Loerke, WFA CEO.

 

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