The media trends to watch in 2023

Several of our predictions from half a year ago, such as quality weighing more heavily in valuations, have been borne out in recent months. Others, such as consultancy firm spinoffs bolting on marketing functions, remain in the balance. But what of the outlook for 2023? Here are our views.

Cross border M&A will return and companies will look west for expansion

The US remains a hot market, with the capacity to attract growing businesses from the UK and Europe. Latin America, too, could be of interest to investors looking for low-cost, highly skilled media and marketing resource pools.

Sector M&A will focus on the mid-market

The uncertain macroeconomic outlook in 2023 is unlikely to favour mega deals but the mid-market segment could still see plenty of activity as acquisitive companies snap up fire-sale opportunities or seek strategic growth through carefully targeted purchases. Private Equity in particular will seize the opportunity for lower valuations to create scale ups and lead consolidation.

Accelerated M&As will grow

With a tighter economy, one final and rather obvious prediction is that we may see more accelerated deals where management teams face a race against time to find a buyer before running out of cash. As a result, we expect to see greater consolidation by well capitalised firms especially in the digital marketing, publishing and events sectors.

The value of a sector focus will grow

Access to customer data is getting harder with cookie degradation and the growth of walled content gardens. To overcome these barriers to personalisation, we expect media and marketing agencies to focus more on niche sectors where segmentation is easy.

Streaming will consolidate

As streaming platforms proliferate and the fight for subscribers intensifies, expect to see greater cross-platform collaboration and increased acquisition of smaller channels, back catalogues and specialist content such as regional sports or factual and documentary content. Alongside this, as Podcast popularity continues to rise and growing consumer interest in audiobooks we see increased advertising and other forms of monetisation and consequently expect increased deals around catalogues and talent in 2023.

E-sport deals will rise

E-sport channels pulled in more than 29 million viewers a month in 2022 and, like real-life sports, the industry is primed for marketing, advertising, sponsorship and gambling. We expect a rise in e-sport-related deals in general and e-sport betting activity particularly in the coming months.
 

Tech enablement will be a differentiator

Owning a technology platform—rather than building a business based on talent that can walk at any time—has always been a strong draw for investors in media and marketing. It will continue to be so in 2023, with demand-side and supply-side platforms likely getting plenty of attention. 

Metaverse M&A will accelerate

The metaverse has so far failed to live up to early hype, yet there is still plenty of opportunity in this space and companies playing the long game may choose 2023 to invest in technologies such as non-fungible token development or gaming, artificial intelligence and virtual reality creation.

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