Election and Olympics spend cause Carat to double Aussie ad spend outlook for 2016
Media agency group Carat has more than doubled its predictions for ad spend growth in Australia this year, citing the 12-week Federal election campaign as a key driver of the growth.
In its previous update in March, the Dentsu Aegis-owned agency pegged Australian growth at just 2.5% for the year, but its September update puts it at 5.4% with digital cited as the biggest growth medium.
However, the overall Asia Pacific region, which Australia falls under, has seen its growth predictions slashed from 4.4% to 3.9% with conservative growth in China cited amongst factors contributing to a “new normal economic landscape”.
Carat ad spend forecast for Asia Pacific
In its wrap-up the agency cited the 12-week election campaign, Olympics and Paralympics ad spend as generating $110m for the sector.
While digital is lionised in the report the Australian TV sector is singled out as being in decline, set to account for 24.9% of ad spend in 2016 compared with 47% for digital. And declines are predicted to continue with a further 5% drop in spend next year and 4% in 2017, although pay-TV is said to be set to grow by 2% in that time, despite the report highlighting the growth of streaming services.
The report predicts digital to tip over 50% of spend in 2017, at 50.5%, with 16.4% growth this year and 12.4% growth next year.
While search is dominant in the category with 45.1% of spend in digital, display (including video and social) is expected to grow by 20% this year and 18% in 2017.
Newspapers are also slated for another hammering with 7% decline in 2016 and 6.5% in 2017 “with a similar trend expected to continue in the future”.
While 2017 is a fallow year with no major media events slated the growth is projected to be a healthy 4.5%, with the agency citing the return of the Liberal government as providing “positive business conditions”.
Globally the US Presidential elections are set to contribute spend growth of US$7.5bn.
Globally the ad market is expected to be worth US$570bn in 2017.
