March’s ad spend takes a hit as business goes into an election pause

Ad spend has experienced its sixth consecutive month of low demand, with March back 4.7% from last year to $583.6m, according to Standard Media Index’s (SMI) latest numbers.

The SMI recorded poor results in food, produce and dairy (back 23%), retail (back 12%), and automotive (back 7.7%). Ad spend from political parties, industry associations and unions, however, doubled during March to $12m.

The SMI political spend figures exclude Clive Palmer’s United Australia Party spend as, Mumbrella understands, most of the placements have gone directly to media owners rather than through agencies. SMI’s data is sourced directly from media agencies’ billing systems and aggregated to show the combined picture of agency ad spend.

After hitting a 10-year low in February, the SMI has also recorded the largest quarterly decline for the March quarter since 2009, at -4.2%.

Lower business confidence ahead of the federal election is to blame for the decline, SMI suggested.

Alongside the impact of the federal election, SMI AU/NZ managing director Jane Ractliffe is anticipating more low numbers in April due to the close proximity of Easter and ANZAC Day. In 2018, Easter fell at the end of March.

Ractliffe stated: “We already know this year’s April data has been negatively impacted by the extended Easter and ANZAC Day break in April this year compared to the smaller timing impact in April last year when Easter started at the end of March.

“So the downturn in media investment is not going to start to pick up until after the election when hopefully the new Government will be able to restore business confidence and therefore inspire businesses to start reinvesting in advertising.

“The good news for major media is that SMI has always seen large upticks in advertising expenditure.”

In March 2018, ad spend was up due to investment by financial services groups ahead of the Royal Commission, and early spend ahead of the Commonwealth Games which took place that April.

The only medium showing increased bookings in March was outdoor, up 2.4% year-on-year.


Get the latest media and marketing industry news (and views) direct to your inbox.

Sign up to the free Mumbrella newsletter now.



Sign up to our free daily update to get the latest in media and marketing.