The media landscape and its challenges in 2023
The last few years have been chaotic to say the least, leaving media organizations struggling to adapt to changes in audience behavior. The industry has suffered additional blows, thanks to economic uncertainty, the demise of third-party cookies, and budget cuts.
Media organizations are now under scrutiny more than ever to try and reach their desired audiences, quickly and effectively, and settle into what is now the “new normal” thanks to the last four years. We outline some of the changes and challenges the media landscape are expected to face in 2023, and how they can be offset.
Recession and inflation seem to be the key themes for the year, forcing organizations to rethink their processes. Enterprise-level businesses need to ensure that revenue remains constant, inefficiencies are reduced, and costs are streamlined before any economic instability gets the better of them.
In Q1, the 2023 outlook is looking rather bleak for media organizations with 75% admitting the most important thing to them - their budget - is under “heavy scrutiny".
Unfortunately, in times of economic uncertainty, marketing and advertising budgets tend to be the first victims. And according to a World Federation of Advertisers survey, 30% of advertisers are cutting their budgets in 2023, with 74% blaming the economic downturn as a key influencer.
Not only are budgets impacted by economic uncertainty, but combined with continued inflation, customer demand and buying behaviors are also fluctuating. Advertisers not only need to be able to maximize what little budget they have, but they desperately need to justify any new investment they make.
Demand for digital
Advertisers want to be seen as a driving force of revenue, not a cost sink. And despite the shrinking budgets, the digital share of advertising is growing exponentially. Research shows that screen time is projected to surpass 8 hours a day in 2023, pointing to a bright future for digital advertising.
Many advertisers are diverting their funds away from traditional advertising channels, towards direct-to-consumer advertising, where loyalty is maintained regardless of consumer spending.
With 42% of media organizations spending more on digital advertising and 50% planning to cut “offline” ad spend in 2023, advertisers are in a position where they need to reach their audience where they are, and in an effective manner.
With that being said, through using digital channels such as CTV, streaming and media platforms, advertisers are able to create direct and efficient relationships with their consumers.
A Cookie-less future
In order to prepare for a cookie-less future, first party data ownership is gaining steam in 2023, thanks to its high reliability and quality, helping advertisers understand customer needs.
With the shift away from third-party cookies, marketers are looking for new ways to continue their targeted advertising, and with the help of Connected TV’s, marketers get to proactively address identity.
The growth in digital audiences has grown as mentioned, leaving brands pouring what’s left of their budget into CTV, OTT and audio streaming. 93.5% of internet users are watching content via streaming services, and as a source of premium inventory and data rich, the CTV market is expected to grow by 14.4% in 2023.
Key to programmatic growth, advertisers are able to identify and reach viewers as they switch between their devices with the help of CTV and OTT. With competition intensifying in the streaming industry, advertisers have a greater need to contextualize their campaigns and put the most effective ads in front of targeted consumers.
What media businesses need
The growth in digital and the changes in the media industry have been driven by users’ appetite for increased transparency and privacy. Media organizations and advertisers are desperately searching for tools, technologies and solutions to have at their disposal to maximize their digital capabilities and efficiency.
In the era of tight budgets, media organizations need to be able to rely on an ad operations platform that is able to streamline ad operations and optimize campaigns effectively. With the help of an efficient order management platform, media organizations are able to gain total visibility and control over sales, media planning and revenue.