The MediaShop looks at some highlights from Mike Leahy’s January 2013 – March 2013 Inflation Watch. (All figures are 2013 Jan to Mar on 2012 Jan to Mar).
Important Technical Note
New weighting measures were introduced into the TV measurement survey TAMS in 2012 Q3. Thus audiences of 2012 Q3 and later should not be compared directly to audiences of previous periods. This means it is inadvisable to combine the apples and pears of audiences to produce a 2012 annual average per station, and so a CPM for that year cannot be calculated. Accordingly the only real measure of trend for the year is the Rate Index and, in line with previous occasions in which the performance methodology has changed, the Rate Index is duplicated in the MIW (CPM) Index.
In the cinema medium Cinemark now supply rates and monthly audience figures for their top 15 houses (142 screens): these houses account for the highest advertiser demand. Accordingly 2013 January to March use the new data and increases on previous periods are based on similar data not released or shown in Inflation Watch.
BE AWARE: it is evident that audience changes in TV, radio and cinema mediums have taken place but one cannot calculate the extent with any degree of confidence.
Television
Rates -5.38%
Performance 0.00% (refer to Technical Note above)
MIW Index (CPM) -5.38%
Being the first quarter of the year demand is traditionally low and accordingly total TV rates tumbled in comparison to those of the previous year’s final quarter. In addition to this 2013 has seen total TV’s Q1 rates below those of Q1 of the previous year. This is unheralded. But there is more to it than a straight rate decline for free-to-air and paid TV have behaved very differently.
Free-to-air’s rates are pretty flat at +1.1% 2013 Q1 over 2012 Q1. Over at DStv Media Sales the rates for many of its station’s packages were cut and/or additional spots provided in 2012 Q2. This carried through to 2013 Q1, which combined with a greater proportion of packages sold compared to loose spots enabled a very buyer friendly -18.4% Rate Index over 2012 Q1.
This massive decrease combined with free-to-air’s virtually zero increase brought All TV down to. -5.38%.
By the end of 2013 DStv’s huge cut will have been worked through, assuming that is, that the network adopts a more traditional approach to rate increases. That is by no means certain as airtime availability continues to be optimised and the channel composition refined as evidenced by the split in the Series channel we will witness in July.
Rates +6.0%
Performance -6.54%
MIW Index (CPM) +14.29%
The print media category’s dynamic is little changed over the last few releases of Inflation Watch: Performance (circulation) deflation continues to be a bigger issue than rate inflation.
As highlighted in a previous newsletter this deflation is most notable amongst dailies which put on +5.6% in rate but lost -8.9% in performance (circulation). This got them a +16.6% MIW Index (CPM). Cape Argus’ MIW Index (CPM) is the highest at 37.4% due to +13.4% rate increase allied to a -17.4% circulation decrease.
This is the fall-out of the switch to tabloid format. On a positive note the title has managed to put on circulation Q1 over Q4 for the first time since 2007. Daily Sun’s circulation continues to slide, this time by -21% 2013 Q1 over 2012 Q1, yielding a 31.8% MIW Index (CPM). This daily has fallen from a high of over 513 000 daily circulation in 2007 to just over 296 000 in the latest quarter. Some major titles do buck this bad news, most notably Die Burger, Sowetan and The Times.
Weekend and weekly newspapers were a mixed bunch but the category fared almost as badly as dailies. Leading the losers was City Press, which has lost some 40% of its circulation since 2008.
Consumer magazines were also a mixed bag. Most rate increases were low, and even some decreases. Circulations of most magazines were down, FHM by -31.6%. It was good to see Fairlady continue to put on circulation, which together with a minimal 1% rate increase resulted in a noteworthy -12.4% MIW Index (CPM).
Radio
Rates +9.58%
Performance -1.83% (refer to Technical Note above)
MIW Index (CPM) +16.65%
Black format stations upped their rates by +9.9% and performance by +1.4%. Normally this would have meant an MIW Index (CPM) of less than the rate increase but the swing of two massive stations Kaya FM and Metro pushed this measure to +10.3%.
The CIW format stations, led by some of the smaller stations such as CapeTalk, Algoa and OFM, registered a rates of +9.58%, Performance of -3.2% so MIW Index (CPM) of a high 19.6%.
Take a look at the cost per thousands. The average black format station comes in at R18.48 whereas the average CIW is R63.66. So evaluate rate changes against comparative values. There is value there.
Out of Home
Rates +5.0%
Performance change none
MIW Index (CPM) +5.0%
Out of home contractors are actually hiking rates but at levels lower than most other media, and somewhat beneath the CPI. Much depends on the format, advertiser demand and location. The 5% featured in the data will workout to 2.5% by the end of 2013.
Cinema
Rates +0.0%
Performance +3.8% (refer to Technical Note above)
MIW Index (CPM) -3.6%
As mentioned earlier the Cinema Index is now worked on the top 15 Ster Kinekor houses (142 screens). Cinemark advise no increase in real average rate over 2012 Q1, a marginal increase in attendance because of better Hollywood/Bollywood products and so a decrease in MIW Index (CPM).
Online
Rates +6.3%
Performance 0.00%
MIW Index (CPM) +6.3%
Some of the asking rates for the top eight online sites tracked in Inflation Watch have increased and so hiked the category. Be aware that because of inventory availability many sites continue to offer massive discounts, seemingly at levels higher than any other medium, and so build this factor into any evaluation. All of the sites tracked charge on a cost per thousand basis so the performance changes, which are significant for the medium, can be factored out of the calculations.
Total All Media
Rates +1.41%
Performance -2.26%
MIW Index (CPM) +5.07%
In summary, rates indicate a continued slowdown over previous periods, largely due to a minimal increase in free-to-air and a decrease in Paid TV’s rates. Remember there is no performance reading for TV.
Of special interest is that 2012 yielded the lowest Rate Index (+3.98%) since the analysis started back in 1986. It is possible that 2013 will be even lower.
This post was first published in The MediaShop newsletter, and is republished with their kind permission.
