So farewell then, January. Traditionally the month of sobriety, lean bank accounts and broken resolutions, January 2023 may have felt even bleaker than usual.
In spite of an unusually warm start to the month (still not much consolation when it costs £500 to take the chill off your home office!), news of poor economic forecasts dominated headlines right after Christmas.
Farewell to the January Blues?
For publishers reliant on ad revenue, looking ahead at a steep drop-off on year-on-year bookings against a backdrop of inflationary pressures, there was little reason for optimism.
Fast forward to the end of the month, and could it be that the deep pessimism of early January was misplaced? Is it safe to look yet?!
There remain, of course, many negative factors at play in the economy and the advertising market – which is usually the first place to experience an economic downturn.
The terrible war in Ukraine drags on, inflation remains high (though falling month-on-month), and hard-pressed consumers aren’t exactly brimming with confidence.
Some glimmers of light, however, may just about be visible, bringing hope that things may not be quite as bad as feared.
The bigger, slightly brighter, picture…
The UK’s economy did not fall into recession in the second half of 2022, as had been widely expected. And whilst, according to sources, such as CNBC, a recession still looks likely in 2023, it may not be as deep or long as had been initially predicted.
The mild winter throughout Europe had a positive impact on energy reserves, which may help to keep inflation from falling later in the year. And, whilst some economists in the US still expect a shallow recession in the second half of 2023, Reuters notes that this is by no means certain.
What the media analyists are saying…
This less-grim-than-we-feared theme is borne out in a host of ad industry data released in recent days. The influential IPA Bellweather Report notes that more of the companies surveyed expect to increase marketing budgets than to decrease them, resulting in an expected net positive impact on spending.
In a similar vein, forecasts released by AA/WARC predict that the UK ad market will grow by 3.8% during 2023. This includes a predicted increase of 5.4% in online display spend. Search specialists BrightBid hail this as particularly good news for search budgets, set to grow 7.7%, on the back of strong growth in 2022.
Approach with cautious optimism
It may still be hard to feel even the most cautious of optimism at this point in time. In interviews with a number of leading publishers, industry bible Digiday revealed that forward bookings in January were lagging behind, along with the rest of Q1.
We fervently hope, though, that the more positive data points and forecasts seen in the second half of last month provide some confidence for the coming days.