Ad spend drops 28.4% in July – SMI optimistic about slowing decline
The media agency-funded ad market improved in July, with the COVID-19 induced decline slowing to a 28.4% drop in national marketer spend, compared to a slide of 35.7% in June, 40.4% in May, and 35.3% in April.
Standard Media Index (SMI), which compiles the numbers, said that early August figures look better again, back 25.2% excluding digital media with three trading days to go, thanks to advertisers spending more in August than they did for the entirety of July.
In July though, all media reported significant, double-digit declines. Cinema was back 96.2% (worse than June’s 86.9% drop), outdoor 65.7% (a slight month-on-month improvement), and magazines 59.7%.
TV slid 22.7%, radio 29%, and newspapers 38.2%, all improvements on June’s figures. The bright spots, according to SMI, include: regional radio (down 11.6%), social media (back 13.8%) and video sites (a drop of 13.7%).
July results. Click to enlarge
The month’s result means that the market is down 24.5% for the year to date. But SMI is encouraged by the July result, and August’s additional improvement. TV is so far back 11.2% for August, the best performing medium.
“It could be that for August the percentage decline reduces into the teens as we’re seeing strong forward bookings for numerous product categories and both the television and digital media are more quickly returning to a pre-COVID state with digital’s July decline of 15.6% the lowest of any major media,” SMI managing director Jane Ractliffe said.
“And for the month of October the value of committed ad spend is now only six percentage points behind where it was at this time last year.”
The results for the year to date. Click to enlarge
SMI also pointed to the retail category’s recovery, back only 3.8%, and the fact that chemists, supermarkets and outdoor/garden retailers all upped their media investment. Toiletries and cosmetics advertisers increased their spend by 20.7%, and hair care (part of that category) almost doubled ad spend.
Haircare category spend across the media owners. Click to enlarge
The New Zealand market has fared better throughout COVID-19, and this was reflected in its July results. New Zealand’s ad spend was down 21.1%, and regional radio increased its investment by 15.6%.
“All markets are slowly rebuilding after COVID inflicted huge declines in advertising expenditure and it’s great to be able to report the early signs of growth as the media world tries to return to a new normal,” Ractliffe added.
It’s the first results since the local market finished its “worst [financial] year in living memory“, down 14.7% due to the compounded effect of this year’s bushfires, followed by COVID-19.
Brittney Rigby was Mumbrella's deputy managing editor - news and analysis. She left Mumbrella in April 2021.
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