NEW YORK — To gaze into the coming year and to share their perspectives on what the economy holds has become perhaps one of the strongest sessions at Forecast, the annual conference produced by Radio + Television Business Report and Radio Ink.
That promise was fulfilled, as a panel of industry leaders began with data from Magna Global EVP/Managing Partner of Global Market Intelligence Vincent LeTang.
Reviewing September 2022 findings with the capacity crowd at the Harvard Club, LeTang offered one bit of bad news before sharing two pieces of good news.
First, GDP growth outlook is now looking much bleaker than what was forecast in August, declining to 2% growth for real GDP in 2023 to just 0.7%.
At the same time, while core inflation is expected to drop from the 7%-8% levels seen today, the 2023 core inflation rate is now projected to be 3.4%, a tweak from 3%.
Here’s the good news: There is continued expectation that the job market will be resilient, with 2023 year-end unemployment rates scheduled to end at 4.2%. “For a recession time, it is pretty mild,” LeTang said.
LeTang also rattled off a full set of financial trends by media segment, noting that, cross-platform, Audio is up. But, digital is clearly driving those improvements. Meanwhile, search is up by mid-teens growth while the “most shocking results” show Social up just 4%.
Overall, 2022 is shaping to be up by 10 percentage points (two percentage points lower when subtracting political dollars).
For 2023? “We pretty much expect everything to slow down,” LeTang said.
Out-of-home is still stronger than any other category growth-wise heading in to 2023, as the return to the road following the COVID-19 pandemic is fueling growth in this sector.
Looking at verticals, Automotive will grow. But, while car sales continue to stabilize, growth is coming “from such a low bar.” Furthermore, LeTang noted, manufacturers are more likely to fuel the ad growth — not so much the local dealer.
Meanwhile, the Travel and Technology categories are stagnating and are trickling downward, with Finance, CPG and Pharma each seeing slowdowns. Restaurants may grow a little, LeTang predicts, but that may not be significant when it comes to local media since digital is included in LeTang’s data points.
Also shared on the panel: Midterm political ad dollar spending outpaced the last presidential election, with Senate candidate and PAC dollars totaling $3.4 billion in 2022. This was shared by PQ Media’s founder, Patrick Quinn.
Erica Farber, President/CEO of the RAB, was upbeat, noting that Retail is looking up. Cannabis advertising, still under Federal law, are getting their spots cleared on radio stations. As laws change, “This is potentially a very large category for us.” Even in the automotive space, supply and demand is still tough, but, “you still have to service your automobile, so the message is different.” Thus, the local dealer has an opportunity not to sell, but service, vehicles. “There are still gas-guzzling vehicles that need to be maintained, and there is money in those categories.”
Steve Lanzano, the President/CEO of TVB was also a panelist. For him, datacasting and ATSC 3.0’s rollout is the big value proposition that Wall Street hasn’t yet discovered. Then, there is advertising — with advanced advertising a long-term offering.
“It is going to take a few years to get to 50% household penetration of NEXTGEN TV, and once that happens that will get the attention of advertisers,” Lanzano said, noting that advanced advertising is “a real revenue stream” for broadcast TV in the coming years.
What else was said at this panel? With no outside press, you had to be there! Don’t miss out in 2024 — save the date today by visiting http://www.radiotvforecast.com.
