Foxtel estimates Stan, Presto and Netflix spent $45m on marketing in first quarter of 2015

The panel (l-r): Tim Burrowes, Mumbrella (moderator); Tristan Masters, Standard Media Index; Dan Sinfield, Carat; Ed Smith, Foxtel; Felicity Emmett, ANZ

The panel (l-r): Tim Burrowes, Mumbrella (moderator); Tristan Masters, Standard Media Index; Dan Sinfield, Carat; Ed Smith, Foxtel; Felicity Emmett, ANZ

Foxtel chief marketer Ed Smith has revealed he believes the streaming war between Presto, Stan and Netflix has seen them spend $45m in the first quarter of 2015, as the trio battle it out for eyeballs.

Smith’s claim came after Standard Media Index’s (SMI) global analytics director Tristan Masters had revealed the first quarter of the year had seen record agency ad spend, shedding light on the factors which had led to the 4.3 per cent increase to $1.7bn at Mumbrella’s Spends & Trends breakfast in Sydney.

Asked about how his business was growing Smith said: “We have had a very big shift in our landscape in the last six months, I was actually adding up what Presto, Stan and Netflix have spent on advertising in the last quarter and I reckon it almost accounts for all the growth (in the sector).

“They must have spent between them around $45m since the beginning of January.”

His comments echo other streaming players with rival FetchTV boss Scott Lorson, last month, telling Mumbrella tens of millions of dollars would be spent by the telcos and streaming players in a major land grab for marketshare.

foxtellogo-234x108Smith told the audience during a panel discussion that also included SMI’s Masters, Dan Sinfield from Carat and Felicity Emmett from ANZ, that the IPTV sector along with Foxtel’s recent price reduction had been key to the pay-TV player’s growth.

“We have been stuck at 30 per cent penetration for our core cable and satellite product for about three years and we were getting most of our growth through Telstra T-box and then through Foxtel Play,” said Smith.

“We had a very big restructure in our business last year, we have driven a significant amount of cost out of the business since we merged with Austar a couple of years ago and we looked to reinvest that in reducing our prices, acquiring rights for the Cricket World Cup, Asia Cup, Formula One, the V8s, the exclusive deal with HBO and commissioning quite a lot of local content Devil’s Playground etc.

“We are pushing very hard at the moment. We are seeing an enormous amount of growth come through we have seen more growth in the first three months of this year than we have seen in the last three years.

“But it is not easy because we are doing it on a lower cost structure.”



During his presentation looking at trends in the ad market Masters said: “We are seeing a lot more volume ad spend in market. Automotive has seen the biggest growth sector up 11.7 per cent up $24.9m, while banking and finance the next biggest category was down almost $18m.

“But overall the other main softness was in retail down 2.2 per cent or $3.5m.”

Masters noted that most media vendors were seeing increases, with only newspapers and magazines posting declines.

Source: SMI

Source: SMI

“That growth has been a bit patchy depending on which media you are in, with newspapers and mags you have seen year on year declines in the first quarter. 

“While leading the charge, but off a smaller base, is outdoor 16.1 per cent growth.”

The SMI analytics boss noted that some of the biggest increases in digital, which itself was up 15.4 per cent, was coming from increased agency spending on search engines and social networking.

Screen Shot 2015-04-23 at 12.40.27 pm

Source: SMI

“Combined they account for $110.9m for the quarter which in percentage terms is 31.1 per cent of total digital spend,” he said.

“What are the categories that are driving the social growth? It is entertainment, travel, banking and finance, food and automotive.”

Nic Christensen 

Spends and Trends comes to Melbourne this Friday with speakers including Fiat/Chrysler marketer Mark McCraith and PHD’s national CEO Mark Coad. Click the banner below to get more details and book your ticket.SMI


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