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Ad market drops nearly 10% following 2016 federal election, according to SMI numbers

The impact of election spending ahead of the 2016 federal vote has led to a near double-digit fall in year-on-year agency bookings for May 2017, with a 9.7% decline in adspend compared to the previous year.

Overall top-line spending through agencies declined to $589.5m with the Standard Media Index warning that a series of one-off factors, including the the long weekend impacting when agencies can retrospectively pay for May digital campaigns, had further skewed the numbers.

Newspapers continued to shed revenue, with the sector down 29% excluding digital and late bookings, while cinema dropped 20.7%.

Digital’s interim result saw the sector down 16.9% year-on-year, while television, excluding digital, dropped by 2.9%.

Magazines dropped 18.3%, while radio slipped 12.5%.

Outdoor was the most robust sector after TV, down just 3.2% for the period

SMI Australia and New Zealand managing director Jane Schulze said the results needed to be seen in the light of  the election.

“Federal elections are like Olympic broadcasts from an advertising revenue perspective in that they’re absolutely abnormal events that bring in an exceptionally high amount of revenue that is usually one-off in nature,” Schulze said.

“So it’s important to look at the underlying result and also the longer-term trends. In that regard, SMI shows total ad spend for the five months of this calendar year is back only 1.2% and is still up 0.9% in the current financial year period.”

The biggest increases in spending were in the retail sector, up 29% year-on-year to $50.7m, and automotive brands which was up 12% to $71m.

While the decline in government spending was the largest of any sector, down 57% to $22.8m, the food/produce/diary sector was down 27%, losing $12m to report a media spend of $32.8m.

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