With U.S. Prices Rising At Less Than Half The Rate Of The Rest Of The World, How Will It Impact Budgets?

I was planning to do publish this analysis comparing U.S. and worldwide ad inflation as a follow up to last week's ECI Media Management report when I received a dispatch from Brian Wieser's Madison and Wall newsletter poo-pooing the value of such analyses, for a variety of reasons.

I recommend you read Wieser's rationale here, because it makes some excellent in-the-weeds points, but as he and I have debated a number of times in the past, journalists don't necessarily have the same access to the kind of granular data he may be looking at and we have to rely on publicly released data such as ECI's to benchmark the way we cover the industry.



It may be cruder than the nuanced data impacting specific media company revenues, or advertiser ad prices, but it's better than nothing.

And I don't think it takes away from the point I really wanted to make, which is that there is a notable spread between ad inflation in the U.S. and the rest of the world. It's about a two-to-one ratio overall, with many distinct media in the U.S. actually experiencing deflationary ad pricing rollbacks -- notably TV, newspapers and magazines.

The point I'd like to make is that I think it creates an opportunity for many global advertisers and agencies to hedge budgets across international markets, to the extent they can.

The U.S. currently accounts for about 40% of worldwide ad spending, which is down from the dominant position the U.S. had when I first began covering the global ad marketplace years ago.

If advertisers can buy U.S. media at relatively lower inflationary rates will that mean more or less overall money will be spent in the U.S.?

Will advertisers pocket the savings and put it to their bottom line, or shift some of it to other international markets?


2 comments about "With U.S. Prices Rising At Less Than Half The Rate Of The Rest Of The World, How Will It Impact Budgets?".
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  1. Ed Papazian from Media Dynamics Inc, March 6, 2024 at 10:56 a.m.

    Joe, I doubt that time/space sellers or  advertisers base their decisions on how the U.S. compares to the world wide averages or how things are going in any particular country but our own. As for "saving" money, if U.S. advertisers realized what the disparity was between the media "audience" stats they use and advertising reality they would probably increase their spending to get the reach and frequencies they thought they were getting.

  2. Dan Ciccone from STACKED Entertainment replied, March 20, 2024 at 12:48 p.m.

    @Ed.  Agreed.

    Also - deflation for dying mediums in the U.S. does not = good investment either ;)  I'd be curious to see audience loss compared to deflationary pricing and how they match up.

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