Home » Australia To Deliver Its Fifth Consecutive Year Of Financial Year Ad Growth

24 July, 2017

Australia To Deliver Its Fifth Consecutive Year Of Financial Year Ad Growth

Australia will deliver its fifth consecutive year of record financial year ad spend in 2016/17 to reach in excess of $7.1 billion, new data from SMI released today has revealed.

The Australian market was back just 0.1 per cent compared to FY 2016, however, when SMI collects late digital bookings at the end of this month, ad spend will reach yet another record.

The television sector claimed the lion’s share of ad spend from media agencies in FY 2017, at $3.1 billion, followed by digital at $1.9 billion and out-of-home at $864 million. Radio followed with $580 million, then newspapers (excluding digital) at $449 million, magazines (excluding digital) $159 million and cinema $75 million.

SMI: Agency Market on Track for a 5th Year of Record FY Ad Spend
Media Type	FY-2017	% Change on PCP*	Change on PCP
Television	3,064,144,579	-91,627,944	-2.9%
Digital	1,889,611,495	142,019,126	8.1%
Outdoor	863,518,819	63,280,590	7.9%
Radio	580,425,809	14,377,590	2.5%
Newspapers (excludes Digital)	448,598,177	-101,051,745	-18.4%
Magazines (excludes Digital)	158,847,808	-29,367,320	-15.6%
Cinema	75,165,951	506,236	0.7%
Other	24,677,380	-8,667,317	-26.0%
Grand Total	7,104,990,017	-10,530,783	-0.1%
* Prior corresponding period

The SMI FY 2017 data also showed the fastest growing media sectors compared to the previous corresponding period of FY 2016. Digital programmatic exchanges recorded the biggest increase in ad spend of all sectors, jumping 67.3 per cent to $338 million, followed social sites up 20.8 per cent to $229 million and posters/billboards up 18 per cent to $338 million.

Other sectors to quickly grow ad spend in the year were sporting venues (up 12.8 per cent), search affiliates (up 9.6 per cent) and street furniture (up 6.1 per cent).

“The market was stronger in the first half of the financial year, with total ad spend up 1.2% to $3.7 billion, but suffered in the second half due to the backdrop of huge Federal Election ad spend at the same time in 2016, which saw ad spend decline by 1.6%,” SMI AU/NZ managing director Jane Schulze said.

“Federal elections are like Olympic broadcasts from an advertising revenue perspective and are absolutely abnormal events, however the underlying result and the longer-term trends show that Australia’s Agency advertising market is set to deliver its fifth consecutive year of record financial year ad spend which underscores the strength of our market.”

SMI’s FY 2017 report also showed the top 10 product category movements over FY 2016. The aAutomotive brand category increased its ad spend by $46.9 million, to remain the market’s largest product category by providing 11 per cent of all financial year advertising. But this year the retail category grew its total ad spend by a larger amount ($90.1 million) to provide 9 per cent of all advertising this FY.

Unsurprisingly, the biggest fall in ad spend was recorded by the government category, followed by the food/produce/dairy and media categories.

“The fall in Government category ad spend also served to disguise continuing growth from other key product categories and shows the underlying strength of the advertising market. But in the first six months of the new financial year there will be yet more tough hurdles given the Rio Olympics and Census were held in that period last year which inflated the market with incremental spend,’’ Schulze said.

“Nonetheless we expect the market to continue exhibiting underlying growth due to increasing competition within certain segments and the continual product development on the media vendor side which produces even more ways to target potential purchasers.’’

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SMI Data