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2016 was worst year yet for print industry, new SMI numbers reveal

Australia’s print sector had another grim year in 2016, new data has confirmed.

Standard Media Index – seen as Australia’s most reliable barometer of advertising spending – today released its numbers to the market for the full calendar year. The numbers indicate that consumer magazine advertising revenues fell by 18% compared to 2015.

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Meanwhile, newspapers were almost as badly hit, with metropolitan titles down 14%, regional titles down 5% and community titles down 8%. Revenues for magazines inserted into newspapers were also down 18%.

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Magazines saw advertising spend plummet during 2016

And there was little indication of a corresponding growth in digital revenues as print advertising continues to decline – within the digital sector, advertising revenue for content sites only grew by 0.4% according to the SMI numbers.

The numbers are compiled by SMI based on the spending of the major media agency groups, with the exception of IPG Mediabrands, which buy advertising on behalf of Australia’s big advertisers.

The numbers do not take account of direct advertising booking, or other revenues such as subscriptions.

Although they have a different methodology, the SMI numbers for the growth of outdoor are similar to those released by the Outdoor Media Association earlier today which showed a 15.7% growth for the sector. The SMI numbers showed a 16% growth in revenue for posters and billboards.

The outdoor sector (around $820m) is now bigger than newspapers (about $450m) and magazines ($170m) combined.

However, television remains the behemoth of the media industry, with agency revenues topping $3bn. This was despite a 4% fall in both metro and regional television and a smaller 2% fall in subscription TV’s advertising revenues.

The fastest growing area appeared to be digital advertising exchanges which grew by 100%, while ad networks fell by 5%.

Online video advertising grew by 11% to just over $100m.

As a sector, digital grew by 14%.

Radio also had a solid year, with 7% growth in metro radio and 4% growth in regional, with the sector being worth a total of around $580m, taking it past newspapers in relative size.

Overall, media spend increased by 1% to $7.1bn, according to the SMI data – the fifth consecutive calendar year of market growth.

Meanwhile, across the advertising categories, SMI’s data shows Government spending did the most to buoy the market with a growth in spend of $80.9 million due to the Federal Election and Census-related advertising.

Meanwhile, the Health Care category reported the highest growth, up 68%.

Schulze:

Schulze: Growth in key categories

SMI’s MD Jane Schulze said: “`Australia’s media remains one of the most innovative in the world, with our media companies continuing to find new and improved ways for advertisers and their agencies to reach audiences.

“As a result we’ve seen key product categories such as Automotive Brands, Retail, Food/Produce/Dairy and Travel all increase their marketing budgets in the past year and most of those have also grown their advertising spend in December.’’

Meanwhile, the SMI numbers suggest that Seven West Media now brings in more than Nine Entertainment Co in TV advertising revenues, although both went backwards and Ten was the only one of the big three to increase its revenues during the year.

Google was the biggest digital player in terms of media agency spend growing by 13%, while Facebook’s slice of media agency action grew by 17%.

Twitter slid badly, with agency spend dropping 22% from $10m to $7.8m. LinkedIn grew by 8.4% to $12.6m.

Spotify saw explosive growth, more than doubling revenues to $11.9m. Rival Pandora was flat on $6.2m

Fairfax saw its digital spend fall by 11%, ad revenue for its newspapers also fall by 11% and spend on its newspaper-inserted magazines fall by 18%.

News Corp increased its digital ad revenues by 15%, but its newspaper revenues fell by 15% and its magazine revenues dropped by 16%.

Amongst the UK players, The Guardian grew its local revenues to $6.7m, while the Daily Mail brought in just $3.7m.

Buzzfeed’s revenues remained just below $2m.

Bauer had an awful year, with magazine ad revenue down 20%. But Pacific Magazines was even worse, down 25%.

In outdoor, Ooh Media grew by 9%, APN Outdoor grew by 6%, Adshel by 12%, JC Decaux by 5% and QMS by 42%.

Schulze warned that in the final month of the year, several sectors went backwards, with newspapers’ decline rapidly accelerating- showing a drop of 24%, compared to December 2015.

The overall drop of 6.6% in December is likely to be mitigated though, once final numbers for digital are taken into account.

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Monthly ad spend – December | Source: SMI

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