Ad spend back 8.5%, remains ‘unexpectedly weak’ in October

Despite some industry figures predicting the end of the year would see a turn for ad spend, October’s Standard Media Index (SMI) ad spend data shows total agency bookings were back 8.5% over the period, with all major media reporting lower bookings.

The report also reflects the first time in months that the Australian and New Zealand markets are in sync from a demand perspective, but in NZ that follows five months of consecutive growth and an abnormally buoyant September due to the Rugby World Cup and elections.

October didn’t bring the relief the industry was hoping for

Australia also saw the outdoor industry’s bookings impacted by an extra loading period in September, which inflated ad spend and reduced October bookings.

SMI AU/NZ Managing Director Jane Ractliffe said the October results were disappointing – especially in Australia – given that the body had expected at least a small increase in ad bookings in October.

“Unfortunately there was an unexpected and significant decline in travel category bookings with a large decrease in ad spend by airlines and travel agents after months of strong growth. And at the same time we saw continued weakness in automotive brands (mostly brand/sponsorship-related bookings) and retailers,’’ she said.

“Among the major retail sectors, we have seen lower advertising demand from supermarkets, electrical retailers and garden/outdoor living advertisers. Similarly, SMI’s home furnishing/appliances category was also softer this month.’’

Any growth seen in the index was from the insurance and restaurant categories, with the first delivering record levels of ad spend for October and the financial and calendar years-to-date.

Restaurant ad spend has increased by 27.6% this month, largely due to competitiveness driven by home delivery.

In September, ad spend was back 3.1%, but reportedly the month performed better than the last ‘normal’ September – given 2018 saw an influx for the month from the royal commission into banking and 2017 was hit by the effects of the same-sex marriage plebiscite.


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