Extra advertising minutage will not alleviate TV inflation because
the market will absorb any new supply within 18 months, according to a
report by MindShare.
The report - entitled Media Inflation - is published on 10 May and comes
just a month after the Incorporated Society of British Advertisers
re-issued its call to introduce advertising on the BBC as a way of
reducing the inflationary pressure on TV airtime costs (Campaign, 2
But MindShare believes that demand is so high, advertisers would buy the
new capacity at the same price.
And the report points out: ’In a way, this makes ISBA’s proposal
somewhat of a paradox. ISBA’s demand for extra minutes will only be
truly effective if its members don’t really want them.’
The report concludes that media inflation will always be a problem and
states that, ultimately, the only way to combat it is for advertisers
and agencies to become more effective in their media planning and
Mandy Pooler, the chief executive of MindShare, said: ’We’ve decided
there’s nothing that we can do to fix it.’
The report rejects the accepted view that ITV’s loss of audience share
is to blame for TV inflation, claiming: ’There is no evidence that ITV’s
loss of share has so far added to cost per thousands (CPTs).’
The report reiterates MindShare’s view that CPT is ’a misleading measure
of advertiser costs and will soon need to be replaced’. It explains:
’Rapid changes in television are driving a wedge between CPT and the
true unit cost of advertising.’
When new measures are introduced, however, MindShare believes that none
of them will become universal.
The report also undermines the view that media inflation only affects
advertisers, claiming that it impacts on everyone, including media
owners, because it holds back advertising growth.
Advertisers ultimately control media inflation, it claims, so if they
decided to spend less, demand would fall and so would inflation. Pooler
said: ’In a sense, it means that advertisers have much more power.’
The report, which took nine months to compile, aims to show the impact
of inflation on different media over time.