Federal fight dampens agency advertising spend

Federal fight dampens agency advertising spend

Political advertising has contributed to a 3.5% year-on-year decline in ad agency spend in May as Canberra crowds out other advertisers, according a Credit Suisse analysis of Standard Media Index (SMI) figures.

Automotive was the only major category to grow in May, posting 14% yoy growth, in the face of a 44% increase in government advertising.

Retail fell “modestly” by 3% and retail “was particularly weak and has been a significant drag on the overall market over the past 12 months, down 10% during the period”.

May’s 3.5% decline in ad spend comes after 0.7% growth the month before and a 0.4% decline in March.

The weakness is expected to persist through to September with spend slated to recover later in the year with other advertising held until after the election.

While agency advertising is currently down 1.6% year-to-date it is forecast to experience total market growth (excluding digital search and classifieds revenues) of around 3% for the 2013 calendar year.

Digital posted double digit growth of 19.3% but the result is offset by newspapers’ 25% drop and magazines’ 18% slide in May.

After three consecutive months of growth outdoor slumped by 7% last month while radio remained positive, growing 3%.

The largest medium, television, pulled the market down with a 3% decline. The drop comes despite pay TV’s revenue increase (11.1%) with free-to-air’s 5% yoy drop in May offsetting the growth.

The 5% decline was linked to Seven heavily promoting its new shows and the later MasterChef launch.

“TV is responsible for ~50% of total agency ad spend and will be the major driver, and beneficiary, of a recovery in ad spend, in our view,” the report said.

“We expect Television ad spend to pick up in the second half, driven by increased advertising spend post-election and an easier base of comparison.”

Digital’s revenue in April was upgraded from 14.5% to 20.8%, suggesting May’s 19.3% result may actually be around 25% once search and classifieds spend is added, according to Credit Suisse.

Emerging platforms drove online display’s 7% growth. 

Please login with linkedin to comment

Latest News

Tracey Spicer (Journalist & Presenter) at Radio Alive 2018 at Radio Alive 2018
  • Media

Tracey Spicer: Commercial Radio Home To “Some Of The Most Toxic Workplaces”

Media veteran Tracey Spicer has delivered a grim assessment of Australia’s commercial radio industry in how it deals with sexual harassment in the workplace. Speaking as part of a panel at the Radio Alive 2018 conference in Melbourne on Friday, Spicer said she has witnessed “tremendous change happen at the very top end of town” […]

by B&T Magazine

B&T Magazine
Kyle Sandilands and Jackie Henderson (Kyle & Jackie O) from KIIS at the 2015 ACRA Awards
  • Media

Kyle & Jackie O Crowned Best On-Air FM Team At 2018 Commercial Radio Awards

KIIS 1065 breakfast duo Kyle Sandilands and Jackie “O” Henderson have won the Best On-Air Team (Metro FM) category at the 30th Australian Commercial Radio Awards (ACRAs). Held on Saturday night at the Melbourne Exhibition and Convention Centre, and hosted by The Chaser’s Chris Taylor and Andrew Hansen, the ACRAs celebrated the best and brightest talent in […]

Digital Asset Management Solution Collaboro A Natural Fit With Open Data Initiative
  • Technology

Digital Asset Management Solution Collaboro A Natural Fit With Open Data Initiative

Digital asset management solution Collaboro claims its offering is a natural fit with Adobe’s, Microsoft’s and SAP’s new Open Data Initiative, as more organisations centralise their data on a single platform to improve their customer management and improve marketing performance.   According to Warwick Boulter (main photo), co-founder and CEO of Collaboro, a leading full-service solution for managing enterprise-level […]