The media and advertising industries
If you’re feeling a little punch-drunk by all the economic downturn talk through the first six months of 2023 (and really, through the last six-plus months of 2022), you’re not alone. Digiday editors and Digiday Podcast co-hosts Kayleigh Barber and Tim Peterson are feeling it too.
At the year’s midway mark, the pair compare notes on the state of the media and advertising industries. The discussion ranges from the decline in ad spending to the rise of generative AI, with the duo delving into how the ad sales cycle has changed and to what extent those changes are temporary or permanent.
The foggy financial forecast
The pressure on ad pricing
Peterson: With advertising, it’s like, are advertisers cutting budgets because they need to cut budgets because they need that money so they don’t have to lay off their employees? Or are they cutting budgets because they see an opportunity to pressure media companies — whether it’s TV networks, streaming services, publishers — to lower their prices? It doesn’t have to be mutually exclusive. Both can be true. With the upfront cycle that we’re in the middle of, it seems like that’s very much at play.
Publishers’ embrace of AI
Barber: For media companies who are struggling, those shiny new toys [like artificial intelligence] are really good at getting investors excited and shareholders excited. And it does, I think, eliminate a lot of operational overhead if used effectively. Or it replaces a lot of operational overhead if you get rid of journalists’ roles who were once [producing content]. I think it can help with some cost-cutting, but there is a lot of investment that goes into it upfront.
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