Bet You That Forecast Will Change Soon

Last Christmas I forecast Chelsea would win the premiership by at least 8 points. I didn’t want them to (I don’t like Chelsea) but I bet some football mates that they would. Could be seen as a form of hedging; could be seen as a very generous/daft bet.

Either way I lost all round. Chelscum did win it – but not by enough to earn me a few pounds. Although I still maintain they should have done. By ten this year anyone?*

The media industry is full of forecasts. This week, hot from her front of house role at our Future of National Newspapers seminar, Claire Enders added to these with some thoughts for the next two years – pretty tough times in summary.

I gathered together a few numbers to set the scene at last week’s event – among those were agency forecasts for newspaper advertising revenues for this year and last. What was most striking was not the numbers themselves, but the trends. One agency group had changed its forecast for newspapers this year from -5% to -1.4% in the space of just three months. That is a lot of extra money suddenly committed.

Given that forecasters at agencies can look at committed client budgets and talk to their clients about future plans, and that the largest groups (all of whom forecast) handle a lot more than half of UK media spend on behalf of their clients, this points to a number of things:

Clients have clearly committed more money to traditional advertising in total this year than their agencies were expecting – this is testament to some of the hard work at media owners and agencies to bring this about – and some relatively cheap prices (TV was being forecast as flat by many and is now expected to grow by a double digit amount).

Presumably this may also mean a profitable year for agencies if they had previously cut their cloth to meet their own forecasts, and not over-promised on deals… and it’s looking good for a number of media owners too (see DMGT’s recent figures).

However, above all, what it shows – amidst a little opportunism no doubt – is continued uncertainty and short-termism with regard to client advertising budgets. The only certainty appears to be the public announcements from the COI. If the guys closest to the budget holders are struggling to predict with any certainty…

Some media owners are already telling us that they expect a rather better 2011 than Claire Enders is forecasting, but I am not sure how many would feel confident enough to bet on it yet.

*Please note: All football opinion and forecasts are purely personal and (sadly) do not represent the views of MediaTel Group as a whole.