Can brands fight off media inflation to score in Q4?

As the UK wrestles with soaring retail inflation, marketers and advertisers are facing their own issues, with rocketing media inflation pushing up TV advertising costs by 31.2% from pre-Covid levels, and the UK sector predicted to see linear TV inflation of nearly 20% for 2022.

But with the country entering the so-called “golden quarter” where should brand owners be spending their budgets? Decision Marketing quizzes industry experts to gauge what they believe brands should be focusing on.

The Specialist Works managing partner Lee Baring is in little doubt, insisting that brands must maintain their focus on attention rather than price, with a brand’s ability to decrease attention-harnessing spend depending on its own brand equity in its target market.

He adds: “With TV being the greatest inflationary concern, brands will have to trade flexibly to work around inflation rather than through it. One strategy could be to partner with specific suppliers to design short-term relief. Also considering the wider communication opportunities available beyond linear spots could offer equitable attention-driving solutions.

“Searching for alternatives outside of TV could be an option, especially in radio and OOH. But this doesn’t mean just repurposing the TV strategy – rather a specific channel and creative strategy needs to be deployed to embrace the channel’s individual characteristics.”

For Raconteur director of partnerships David Kells, it is a major concern that the dreaded ‘R’ word’ has reared its head once again and with Q4 set to be rich with opportunities as the World Cup coincides with the festive season, it is understandable why many marketers feel indecisive.

Kells explains: “When the economic outlook is gloomy, it can be easy to lose confidence, panic and cut marketing budgets, but we know this doesn’t help businesses in the long run. Marketers need to ensure their budgets are protected as much as possible by showing the impact this investment has both short and long term.

“After all, if a brand won’t invest in itself, why should its customers? Focusing on building brand awareness through high-quality content placed in the right media is a great way to ensure your brand remains top-of-mind among consumers and can make the most of the opportunity in the golden quarter and beyond.”

Meanwhile, VaynerMedia London vice-president of global media Ben Allison believes the critical consideration is twofold: “We have to consider how brands align with the different platforms in the industry, and then, how they compare to a regular, competitively priced marketplace.

“For brands that are heavily reliant on holiday spending dynamics (or have strong associations with sport and the World Cup), this quarter presents a huge opportunity. But for brands that experience different sales spikes and consumer associations, this will be a time to step back from what will most certainly be a highly-inflationary period.

“For brands focused on driving performance and sales in this period, we are seeing significant uptick in native checkout using Meta-owned platforms, which presents a massive opportunity to increase investment efficiently and effectively. That alongside further bolstering owned properties using in-app notifications, emails, SMS and other channels, which are great ways for brands to push their marketing in competitively priced environments.

“And for brands aligning with sport and the World Cup, specifically, there continues to be opportunities around growing recommendation-based media (TikTok, Reels, Shorts, etc.). This is because time spent and daily active users keep rising at a meteoric pace and content tends to be focused on culturally-relevant and timely events, of which the World Cup is a perfect example.”

Finally, Analytic Partners senior director Justine O’Neill insists Q4 has always been a challenging quarter for brands, and, particularly for TV, October and November in the run-up to Christmas are the most expensive months.

However, she maintains that one of linear TV’s biggest advantages has always been its reach – you cannot reach new audiences as effectively as TV – while targeted digital ads can deliver a strong ROI with low level investment.

O’Neill adds: “The World Cup typically sees incremental spend, where brands would choose to invest more heavily, making the most of its strong return on investment. For brands with big budgets, there is no doubt TV is the best path. Sponsorship is another interesting area for brands to consider, but this would depend on your ability to negotiate a good rate. Big brands can make a big impact, but again this comes at a premium.

“The greatest challenge is for brands with limited spend or those expecting budget cuts due to the impending recession. Now with media inflation, TV investment doesn’t give brands a huge amount of ratings, reducing impact. Brands need to decide: do they continue to invest in TV, despite knowing they can only afford to invest below the optimal level to gain the reach or do they go all in on digital channels and accept lower reach?

“Our advice is to experiment with other channels, such as connected TV, which is still in its infancy. Streamers now have a captive audience, but the space is still experimental, and is yet to prove itself as a good place to invest.

“For Q4, many brands will decide that the inflated media market is not a game they are willing to play at all. For smaller brands, we suggest that TV is not worth the investment, that it is better to come back fighting in Q1 where your money will go further.”