Ad spend for May down YOY, but CYTD and FYTD ad demand at record high

Following the Federal election period, Australia’s media agency market has emerged with total ad spend just below the record level reported in May 2021, but ahead of the total invested during the previous election period in May 2019, reports Standard Media Index (SMI).

Overall, total ad spend for May is stable compared to last year’s very high benchmark, having dropped just 0.9%, with the key feature this month being an extra $41m in political party/industry association ad spend (excluding UAP ad spend). Government category ad spend continued to grow, this time up 42% YOY.

SMI AU/NZ managing director Jane Ractliffe said federal elections usually create an abnormal spike in monthly ad spend, but this election period was unusual as the market was being compared against the May 2021 result which was the largest ever spending May on record.

“So the better measure is total ad spend in the last Federal election period of May 2019, and the level of ad spend is 0.2% above that total,” she said.

“It also looks as though some advertisers have decided to move campaigns into a more uncluttered media environment in June as we can see in the SMI Forwards data that 83% of the value of advertising booked in the record June 2021 period has already been confirmed (ex Digital).”

However, for the month of May SMI reported more patchy ad demand, with digital bookings up just 2.1%, though key sectors including search, social media and video sites delivered higher growth rates. Similarly, video ad spend (excluding UAP) was back 2.5% but within that linear regional TV bookings grew 7.2%. In addition, the audio (+4.7%) and cinema (+68%) media delivered growth on a standalone basis.

The political party/industry association category saw the majority of ad spend continue to go to TV/video, with its share of the category increasing to 72% in May 2022 from 68.5% in May 2019, while the biggest change since the last election was this category’s move of significant investment from the digital media to outdoor.

Outside of election-related categories there was a softer market with retail category bookings back 5.7%, food/ produce/dairy ad spend back 17.5% and auto brand ad spend remaining weak, having fallen 26% YOY.

Not including the government and political party categories, the underlying market was down 9.1% YOY.

However, months of continued growth have characterised a positive longer term outlook, with SMI reporting record levels of ad investment in both the CYTD (+7.8% on the prior year period) and FYTD, with the market having grown more than 12% in that time to be through the $7 billion mark for the first time over these 11 months.

In addition, this month SMI overhauled the reporting of the financial services market with its ad spend now organised on a product basis. This means SMI categories such as banking and the new wealth management category now include ad spend from any provider of financial services, including the new fintech companies.

“SMI has responded to feedback from the banking sector that we needed to provide a broader view of this market to better reflect emerging players and this change has also resulted in the creation of a new Wealth Management product category and three new subcategories: superannuation, wealth management and payment platforms,” Ractliffe said.

“As the accurate SMI data is a crucial tool in share of voice analysis – especially for Digital media where Category ad spend can be viewed for Search, Social Media and Programmatic and by Digital publisher – we are always keen for feedback on how to better reflect changing category ad spend trends.’’


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