Tag Archive: digital inflation

  1. Why you shouldn’t be afraid of advertising next to coronavirus-related content

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    A dramatic change in media pricing

    In our coronavirus update to our annual Inflation Report, we revealed that an increased supply of inventory, teamed with decreased advertiser spending, will likely lead to dramatic deflation in the cost of traditional media across the world.  Although not as dramatic, digital media are also seeing price drops in EMEA and North America (although they are more buoyant in APAC), as programmatic media adjusts directly to changes in offer and demand. However, there is an additional trend reducing the price drop for digital: the use of programmatic blacklists to block terms associated with coronavirus. A reduced drop in pricing might sound like good news for the digital media industry, but the blacklisting trend is having a dramatic impact on digital publishers.

    Brands are blocking coronavirus-related keywords

    Consumers living in lockdown are turning to digital channels to stay updated on the news and for entertainment – with increased eyeballs, it would seem to be the perfect time for advertisers to build awareness of their brands and their products. But many of them are squeamish about coronavirus-related content, and are turning to keyword blocking as a way of safeguarding their brands from appearing alongside content related to the pandemic – good or bad. Ad verification firm Integral Ad Science estimates that blacklisting during the pandemic has kept more than 1.3 billion ads from appearing next to content featuring the world ‘coronavirus’ – and that doesn’t include other terms such as ‘covid-19’ and ‘pandemic’. Of course, the pandemic has affected every aspect of society – healthcare, of course, but also the economy, work, sport, home life and retail – which means that ‘coronavirus’ appears in almost every news article published. The loss of ad revenue that comes from blocking coronavirus-related keywords is devastating for online publishers, to the extent that the future of many is at risk. This would be a huge blow not just for them, but for the many advertisers for whom appearing alongside high-quality journalism forms an important part of their advertising strategies.

    A nuanced approach will keep your brand safe and allow you to benefit from larger audiences

    A blanket approach to blacklisting is not necessary in this context. The IAB has been working to combat this practice, providing guidance to advertisers around how they can keep their brands safe and avoid embarrassment, whilst still supporting quality journalism and benefiting from the hugely increased and highly engaged audiences. The approach that the IAB recommends is pragmatic, harnessing tools and techniques which allow a multi-faceted, more nuanced approach, for example incorporating semantic and contextual solutions. More sophisticated tools can identify the context of an article: a news story that talks about local heroism or how to juggle working with home schooling will still mention coronavirus, but is a much safer context than a story that talks about the number of deaths in care homes, for example. Indeed, a more nuanced and thought-through approach regarding the selection of ad environments has always been advisable. As with domain lists, it is typically most efficient to focus on defining and selecting desirable environments and partners (whitelists) rather than the undesirable ones (blacklists). Domain and keyword blacklisting should be part of a strategy, rather than a strategy in itself; there is limited value in the longtail of domains in any case.

    Add value for consumers by adapting messaging and creative

    Messaging and creative is also important. A lot of the news right now is bad, but by striking the right tone, ads can add value to the reader’s experience. An appropriate tone could mean being helpful, providing products or services that benefit consumers, not exploiting the situation, offering reassurance or showcasing, with modesty, how you have helped. Global research carried out by by Kantar shows that the vast majority – 92% – of consumers do not expect brands to stop advertising during the pandemic.

    Burger King: getting the balance right

    Burger King is a great example of a brand that is getting the balance right. It rapidly adapted its messaging and creative as the virus spread, focusing on contactless food delivery and pick-up, which means its marketing doesn’t seem out of place in a news cycle that is relentlessly focused on the pandemic and on the lockdown restrictions across the world. As Burger King’s Head of Brand and Communications, Marcelo Pascoa, told The New York Times, ‘It isn’t damaging for the brand to appear within the context of the crisis, because the brand is playing a role’.  Global CMO Fernando Machado, agrees, telling DigiDay, ‘Instead of relying on a block list, I would personally rather have us focus on making sure that whatever we put forward takes into consideration the context and that’s exactly what we did… We’re more relaxed about that because of the content we’re putting forward’. The company’s media strategy also reflects the different situation in each market: with restaurants closed in France, it doesn’t make sense to have TV, so investment has been focused on digital to keep engagement high, while in the US restaurants are still open for drive-through and delivery, so TV is more relevant.

    Larger, more engaged digital audiences

    There is huge value to be gained for brands who are willing to take a more nuanced approach to blacklisting. Digital audiences are much larger and much more engaged than normal, but prices are falling because of decreased demand from industries, such as travel and automotive, struck hardest by the pandemic. Now is a great time for brands who are in a position to spend to grow their share of voice and share of market by making the most of the increased value and appearing alongside quality news content which is attracting huge numbers of eyeballs. Premium placements with trusted news organizations are a great option as they are more likely to appear alongside thoughtful, less alarmist journalism.

    Helping you to successfully navigate a new media landscape

    It’s natural for brands to be more cautious in a global crisis such as this, with so much economic uncertainty making expensive brand safety errors something to be avoided at all costs. But at ECI Media Management we believe that this is an opportunity for those with budget to spend to benefit from increased return on investment. We’ll continue to provide forensic analysis and actionable insights so our clients can successfully navigate a media landscape that has transformed beyond all recognition, and plan their media activity during this crisis and beyond.

    Read and download the Coronavirus Update to our Inflation Report here.

    Discover our top 10 recommendations for advertisers during the coronavirus pandemic here.

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    Image: Anton Veselov/Shutterstock

  2. Coronavirus has a dramatic effect on media inflation

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    In just a few short weeks the Covid-19 pandemic has disrupted the human way of life right across the globe. We have been forced to stay at home and, crucially for the advertising industry, our consumption habits have been transformed quite literally overnight. Many brands have been impacted by reduced spending, forcing them in turn to reduce their own advertising budgets; almost all advertisers have revised their 2020 marketing activity in some way.

    This disruption to global media markets has caused a sharp drop in demand and, as a result, a decrease in pricing for most media types, according to ECI Media Management’s special report on the impact of coronavirus on media inflation, produced by our experts. At a global level, all traditional media types will suffer from deflation of varying severity, while Digital Display and Digital Video – which were looking very robust in our original report released at the beginning of the year – are forecast to be only minimally inflationary in 2020. The story is more varied at a regional level: in North America and EMEA, all media including Digital are deflationary, while in APAC and LATAM some media types are showing more resilience. It seems likely that the fact that these regions are at different stages of the pandemic – APAC is seemingly through the worst, while LATAM looks to be at the start of the curve – is affecting inflation.

    Digital: inflationary overall, but deflationary in key markets

    With advertisers shifting spend out of OOH, demand is high for digital, leading to overall inflation for Digital Video and Digital Display, particularly in APAC which is driving global Digital inflation. However, several major markets such as the US, the UK and France are experiencing deflation in digital channels due to the huge inventory increases combined with decreased demand. The use of programmatic blacklists to block terms associated with coronavirus is reducing the price drop for digital channels, although the trend is causing digital publishers to struggle – the IAB is trying to combat this practice.

    The video streaming platforms should be one of the few sectors to benefit from the coronavirus pandemic, with subscriber and viewing figures up significantly. Those platforms with a revenue model based on advertising should see increased demand from advertisers seeking to benefit from that increased viewership, especially in the US.

    TV: consistently deflationary, except in APAC

    TV viewership has perhaps never been higher, with people turning in their droves to TV as a source of information and entertainment. The increased viewership has led to increased supply, particularly as some advertisers have had to pull their spend – and that has led to an overall deflationary trend. This means that there is huge value for those brands who are still active in TV, with much more reach at no extra cost.

    Coronavirus will have a lasting impact

    Coronavirus and the havoc it is wreaking on our economies and our way of life will have a profound and enduring effect on the entire advertising industry. It seems inevitable that, when we do emerge from this crisis, the landscape will have dramatically transformed. Economic uncertainty and a lack of growth will likely see brands continue to exercise caution over their marketing spend: ad spend is likely to decrease, and media inflation will inevitably respond. At ECI Media Management, we will continue to provide forensic analysis and actionable insights so that advertisers are able to successfully navigate this new terrain. Please don’t hesitate to contact us if you would like to discuss your media activity in a post-coronavirus world.

    Read and download the report here.

    Discover our top 10 recommendations for advertisers during the coronavirus pandemic here.

    Image: Cipariss/Shutterstock