Forecasting
Part of Media forecasting and scenario planning
Planning a response to rising inventory costs
Diagnose higher media prices, recalculate delivery at the approved budget, and choose a response with its audience and cost trade-offs visible.
Reforecast what the remaining budget can buy when inventory costs rise, before changing bids or adding money. Identify which price changed, check whether the audience and placement still justify it, then choose a response within the approved limit.
Identify the increase
Compare like periods and inventory, and check the current quote or live report against the original forecast settings. Record the price unit, eligible placement, audience, geography, dates, media charge and separate platform or service fees.
A higher average CPM can reflect a different inventory mix or tighter targeting as well as changed auction conditions. It does not, by itself, show that every comparable impression became dearer.
Key metrics to track when inventory costs rise
- Price unit
- CPM
- Eligible placement
- As per original brief
- Geography
- Australia
- Media charge
- Separate from platform fees
Recalculate what the budget buys
For a first sensitivity check, hold the media amount and delivery unit fixed. In a hypothetical example, A$10,000 at A$10 CPM buys 1,000,000 impressions if every impression costs that amount.
At A$12.50 CPM, the same spend buys 800,000. Maintaining 1,000,000 impressions would require A$12,500 in media at that price. The figures exclude other charges and do not estimate unique reach.
Next, request an updated reach and frequency forecast for the actual plan where one is available. A reduction in impressions need not produce the same percentage reduction in unique reach: delivery may shift between new and previously reached people. Keep the forecast's audience, dates and settings attached.
Possible response / Approval question
- Keep the ceiling
- Is lower forecast delivery still useful for the communication task?
- Add approved spend
- What added reach or other evidence justifies the extra amount?
- Change inventory or targeting
- Does the alternative still meet the audience and placement requirements?
- Change timing or stage the buy
- Can the campaign still meet the customer decision window?
Choose a response
Ask the seller whether another date, format or placement has a credible price and delivery estimate. Check that a cheaper option does not remove a context, geography or audience condition essential to the brief. For a booked placement, confirm the applicable change terms before assuming spend can move.
Do not increase budget solely to defend an old impression target. Compare the extra cost with expected added reach and the business limit. If repetition rather than new reach is the purpose, state that objective. If neither justifies the revised cost, narrow or defer the buy.
Set an early review of actual price, spend, eligible delivery and the business outcome record. Log any change to bids, inventory or targeting with its approval and effective date. This lets the final review distinguish the price change from changes to the media plan.
