The increase in the dollar exchange rate in the Egyptian market can significantly impact advertising costs due to the gap between the local currency and the dollar. There are several ways in which this increase can affect advertising costs:

1.Cost of Advertising Media

If companies rely on advertising media that imports equipment or depends on services from abroad, an increase in the dollar price will raise the costs of these media in the local currency.

2.Production and Distribution Costs

If companies produce advertising materials with imported raw materials or rely on external services for production, a rise in the dollar price will lead to increased production and distribution costs.

3.Digital Media Costs

Many companies currently rely on digital advertising through the internet and social media platforms. An increase in the dollar price can raise the costs of digital advertising, which is typically paid for in foreign currency.

4.Digital Marketing Costs

With the increasing use of digital advertising, funded advertising costs may include purchasing ad space on digital advertising platforms such as Google, Facebook, Twitter, and others. The rise in the dollar price may increase the costs of purchasing through these platforms, which are paid in foreign currency.

5.Impact on Potential Customers’ Purchasing Power

If the purchasing power of customers decreases due to an increase in the dollar price, demand for advertised products or services may decline, leading to different advertising strategies that may include cost reduction or a greater focus on specific audiences.

6.Targeting and Analysis Costs

Companies funding advertisements may need to use advanced targeting and analysis tools to measure the effectiveness of advertisements and better identify the target audience. These tools may be paid for and require additional costs, which can be affected by an increase in the dollar price.

7.Increase in Advertising Media Costs

Many advertising media such as television, internet, and printed advertisements may import a significant portion of their equipment and raw materials from abroad. When the dollar price rises, the cost of importing these materials increases, which can lead to an increase in advertising costs.

8.Impact on Production Costs

For companies relying on imported raw materials or components, an increase in the dollar price can negatively affect production costs, which can also be reflected in advertising costs.

9.Impact on Purchasing Power

The increase in the dollar price can reduce the purchasing power of companies, making it difficult to allocate large budgets for advertisements.

To address this issue, companies can take some steps such as reducing reliance on imported materials, seeking local alternatives, diversifying advertising strategies to include less expensive media, and carefully managing advertising budgets to ensure maximum benefit from every dollar spent on advertising.

To address the problem of the impact of the increase in the dollar price in the Egyptian market on advertising costs, companies can take some measures:

1.Reducing reliance on imported materials

It may be necessary for companies to shift their focus to using locally-made materials instead of imported ones, if possible. This can mitigate the impact of the increase in the dollar price on production costs and thus on advertising costs.

2.Rethinking advertising strategies

Companies can reassess their advertising strategies to focus on channels that offer the highest return on investment while reducing costs. These transformations may include using online advertising or social media channels, which may be less expensive compared to traditional media such as television and newspapers.

3.Negotiating with advertising suppliers

Companies can negotiate with advertising suppliers to obtain better prices or discounts that reflect the current economic conditions, such as the increase in the dollar price. It may be possible to achieve savings through negotiating prices and payment terms.

4.Developing targeted marketing strategies

Companies can direct marketing and advertising strategies towards the target audience more effectively, which may be more responsive to advertising messages relative to costs. By targeting the audience most interested in the advertised product or service, companies can achieve better response rates with lower investments.

5.Monitoring economic developments

It is essential for companies to monitor local and global economic and political developments to understand their impact on the exchange market and advertising costs, and to adapt their strategies and costs accordingly.

By considering these steps, companies can adapt to the impact of the increase in the dollar price in the Egyptian market and minimize its effect on advertising costs.