The Australian advertising market will fall just short of $16 Billion in total spend in 2017, according to Magna Australia, IPG Mediabrands’ media investment and intelligence division.
The new forecast comes as the Australian market achieved stronger than expected growth of 7.4 per cent in 2016 and Magna is predicting the market will expand by another 6.3 per cent in 2017.
Growth in the Australian advertising market continues to be driven mostly by digital advertising which Magna calculates will be up 16.3 per cent YOY in 2017, leaping to 52 per cent of total advertising spend in 2017 and is expected to secure 65 per cent of total advertising spend by 2021.
In 2017, mobile will command close to 50 per cent of digital ad spend and will be an estimated 66 per cent of all digital advertising spend by 2021, enjoying an impressive five-year CAGR of 22.2 per cent
“This persistent strength in digital growth is especially surprising because Australia is considered one of the most developed digital economies globally,” said Magna Australia managing director Victor Corones (pictured above).
“It means we are not seeing any slow-down in digital advertising investment.”
Growth in social media investment is expected to slow somewhat in 2017, according to the Magna forecast, however social will still experience an impressive growth rate of 28.6 per cent YOY.
Total screen advertising spend is expected to accelerate to +5.6 per cent growth in 2017 off the back of a modest +3.3 per cent in 2016. Television is expected to command 78 per cent of total screen advertising dollars but faces a slight contraction in ad spend of -2.1 per cent YOY due to the absence of special events like Federal Election and the Olympics, with those advertising dollars not being there in 2017. The remaining 22 per cent of screen ad spend will be digital video which will enjoy 45 per cent growth across 2017.
Radio is forecast to increase +2.0 per cent YOY while advertising dollars for newspapers and magazines are expected to contract -12.3 per cent and -10.7 per cent respectively YOY.
Across the Out of Home sector ad spend is expected to be up +8.2 per cent, of which most growth will come from digital assets which will see an ad spend increase of +20.7 per cent YOY.