Analysts Remain Positive About Long-term TV Outlook Despite Ad Slump And Cost Cuts
Despite a prolonged slump in TV advertising spend, industry analysts have said that the long-term outlook remains healthy.
Last week both Seven and Nine announced cost cutting measures in response to falling advertising revenues.
At the Macquarie Conference last week, Seven CEO James Warburton said the company was looking to make an additional $20 million in cut and that he expects that the total television market will be down 11 per cent in the third quarter of this year. ‘
‘The market is still being relatively short and trending in a similar fashion … we could expect that to continue through the rest of the second half, ’’he said.
Also speaking at the conference, Nine chief executive Mike Sneesby said he expects a 15 per cent decline in the free-to-air television market and is also making additional cost cuts.
“It really becomes people and content where we have an opportunity to tighten up costs and we have tightened those (already) this year,” he said.
Quoted in The Australian, Jane Ractliffe, managing director of global advertising intelligence company Standard Media Index AU/NZ, said the large TV companies such as Nine and Seven were “well-placed” to absorb the downturn in ad spend.
“What you really have to remember is that these dips are coming off a massive year,” she said on Sunday. “In the previous financial year you had a federal election, and all the ad revenue that comes with that … the political advertising, and all the spend from different interest groups leading up to the election.
“There was also still a lot of Covid-related ad spend last year.
“So you can put this year’s slump largely down to the perils of having an abnormally large advertising spend last (financial) year. Of course, it’s impossible to have a crystal ball to know where the ad market is going. No one wants to surprise the financial markets, so it’s always better to err on the side of caution and be conservative with these forecasts.”
UBS analysts were less optimistic given the current economic uncertainty.
“For now, we remain cautious on metro FTA (free-to-air) ad market growth into 4Q given continued macro uncertainty, with company commentary suggesting April ad markets have continued to deteriorate but May and June showing some signs of stabilisation,” UBS analysts said in a note. “The additional $15-20m temporary additional cost savings is positive, but we note likely to return when market conditions improve.”
Morningstar said the Covid boost to earnings has well and truly faded.
“The positive impact of cheap money stimulus and advertiser FOMO (fear of missing out) has been usurped by economic worries and marketing spending slowdown,” it said. Morningstar’s report added that “revenue shares are growing strongly which is mitigating impact of current cyclical downturn”.
Latest News
‘Blair Is Mr Happy, Beau Is Mr Dopey, I’m Mr Grumpy’ – Top Gear Australia Hosts Reveal What It Was Really Like Filming
Top Gear features the cars you could never afford to drive. It's a bit like the bogan's Gourmet Traveller, really.
Nine’s Total TV Sales Lead Richard Hunwick To Step Down
Nine's Richard Hunwick calls time after 15 years. Hoping for a last trip to the Olympics before getting the gold watch.
Yahoo Academy Culminates With Pitch-Off For Musicians Making A Difference With Trip To Cannes In Cairns On The Line
B&T happy to support the Musicians Making A Difference initiative. Particularly any that encourages more Watusi.
TV Ratings 16/5/24: Nearly 2 Million Tune In To See Sky Blues Win In Women’s State Of Origin
B&T does make jokes about the Budget reply speech but, to his credit, Mr Potato Head rated OK last night.
Binge Launches “Scene:Scents” Sensory Entertainment Campaign, Via Thinkerbell
There's now scented candles to pair with BINGE shows. We're hoping Rex Hunt's Fishing Adventures doesn't hear about it.
Jolt Partners With Veridooh For Verification Of Its EV Charger Placements In UK
Although B&T's an avid supporter of EV cars, we'd definitely miss the smell of petrol and the service station pie.
Nine Ad Manager Named Principal Sponsor Of CommBank SmallBiz Week
CommBank's SmallBiz Week is coming to Melbourne on the 29-30 May. B&T's as confused as you are on how that's a week.
Pet Circle & Seven Communications Partner On “Pawtition” To Get Pets On Public Transport
B&T's concerned about the fleas, urine & faeces on public transport - and that's just from fellow passengers!
‘A Win-Win’ – How The Matildas Helped CommBank Become A ‘Globally Iconic Brand’ For The First Time
CommBank's sponsorship of the Matildas is a sport marketing masterclass. The opposite to Nick Kyrgios & his sponsors.
VML Australia Dominates The One Show With 5 Gold Pencils
VML Australia flying the flag at the One Show Awards in New York. Not that we need more flag waving at the moment.
Social Soup: Consumers Looking For “Informative” Not “Funny” Social Content When Making Buying Decisions
In a further blow to ventriloquism everywhere, new research says consumers prefer information over funny videos.
GIO Unveils New “Protect Precious” Brand Positioning & Campaign, Via Ogilvy
Insurer asks what's precious in our lives in new work. Which is better than asking is this business highly flammable.
Digitas & Heckler Singapore Launch Animated Symphony For Riot Game’s Valorant Champions Tour Pacific
Stony silence between you and the graphic arts team at Friday drinks? This gaming news could be an ice breaker.
Wavemaker Global CEO Toby Jenner Appointed Global President, GroupM Clients
Wavemaker’s Toby Jenner continues his career trajectory. But is it enough to move him up to the first class lounge?
Fast 10: Mindshare Head Honcho Maria Grivas On Her “Resting Smiling Face”
Mindshare is having a very fruitful 2024. Here, CEO Maria Grivas reveals her fertilisers & pruning tips to success.
Real Home Care Clients & Staff Star In New HammondCare Campaign
Aged care commercial uses real life clients & staff. B&T has not contacted the actor's union for comment.
Mutinex’s Henry Innis: “I’m Imperfect As A Leader”
Mutinex is being touted as one of the hottest start-ups in the land. And we don't mean that in an Elizabeth Holmes way.
Slew Of Senior Hires At Sparro by Brainlabs & Jack Nimble
B&T loves to report new hires as it shows the healthy state of the industry. That and cocaine usage at work functions.
Initiative’s Fein, Geer, Colter To Depart For Accenture Song
As you read first in B&T, there are significant comings-and-goings at Initiative. Though mainly goings, if we're honest.
Pizza Hut Fined $2.5m For Spamming Customers
To be honest, if you're going to spam customers, cheap pizza deals is probably on the low side of the dodgy scale.
Jetstar & Qantas Perception Ratings Soar After Bonza Cancelled Flights, YouGov Finds
This poll is further proof nothing builds a positive brand image like your competitor monumentally f@cking up.
Pedigree Launches AI-Powered Ad Initiative To Give All Dogs A Home, Via Colenso BBDO & Nexus Studios
B&T encourages this dog adoption initiative. And that's despite us barely being able to look after our own selves.
Apparent Launches “All Heart, No hassle” Integrated Campaign For Flight Centre’s Corporate Traveller
Apparent charged with Flight Centre's Corporate Traveller creative. Has avoided any gags about stolen hotel bathrobes.
South African Tourism CMO: ‘We Want Consumers To Experience SA Through The Eyes Of A Child’
B&T chats with South African tourism's Aussie CMO. Admittedly, we had to quickly rectify our Barossa Valley questions.
Market Research Firm TRA Names KFC’s “Look On the Fried Side Of Life” As Australia’s Favourite Ad
A poll of everyday Aussies has revealed our favourite ads. And it'll make difficult reading for the Harvey Norman team.
‘A Big, Big Step In The Right Direction’: Media Buyers React To News Corp’s D_Coded
There was a universal thumbs up for News' D_Coded event. Although there were calls for glitter bombs at the finale.
CommBank Announced As Presenting Partner Of Vogue Codes 2024
Vogue Codes is a top initiative encouraging women into STEM-based careers. All while wearing Jimmy Choos, apparently.
Brad Garbutt Joins OMA As Marketing Lead
Seasoned adlander Garbutt joins the outdoor association. Says he's got the DOOH down pat, but working on the PDOOH.
TV Ratings 15/5/24: Gruen Pulls A Crowd For Aunty As It Enters 16th Season
Although B&T typically shuns predictions, we're expecting big numbers for Peter Dutton's Budget reply speech tonight.
D_Coded panel: ‘If You Are A Marketer Handling Data And Haven’t Spoken To Legal, You’re In Trouble’
This fiery panel was a highlight of Tuesday's D_Coded event. Not that it spilled out into the carpark.
SBS Audio Campaign Tells The Stories Of New Australians, With Multilingual Content Offerings To Assist Migrants
SBS Audio has launched a new marketing campaign for its ‘Australia Explained’ service which supports new migrants to successfully navigate life in Australia and achieve a greater sense of belonging and social cohesion. SBS’s flagship service for new migrants, Australia explained, has launched a multi-platform marketing campaign that reaches into the heart of the migrant […]
Tracker App Launches, Promising Consumers A Read On Brand’s & Products Sustainability Chops
Shoppers can now get access to sustainability information at their fingertips through Tracker, a first-of-its-kind mobile app. The Tracker app centralises sustainability data into a single, easy-to-understand format, helping shoppers make informed choices about the brands and products they support. Shoppers can simply scan the barcode of their favourite supermarket, chemist or department store item […]
Channel Factory Expands Team Across Australia & New Zealand By 20%
Social media agency Channel Factory announces a significant lift in staff numbers. Doesn't thank Tuesday's Budget.
Jaywing Extends Strategy Team Appointing Fran Martin As Senior Brand Strategist
As is often said, you can never have too much strategy. Same can't be said of programmatic & AI.
Tourism Tasmania Taps Broadsheet For Latest “Off Season” Campaign Iteration
Do you like to drape yourself in sheepskin, flannelette & weird, wooly hats? Tasmania in winter is for you.
Netball WA Appoints 303 MullenLowe As Brand Strategy partner
Netball WA appoints 303 MullenLowe for its brand strategy. Any mention of Gina also now strictly forbidden.