Marketers withholding budgets for the second half of the year: AANA and Ipsos

Half of Australian marketers are withholding their budgeted advertising spend as they wait for more stability in the country’s COVID-19 status, new research from Ipsos and the Australian Association of National Advertisers (AANA) has found.

The findings come as the Standard Media Index (SMI) has reported that the media agency-funded ad spend market fell 14.7% for the financial year and 35.7% for the month of June.

The AANA’s research found that 68% of small to medium-sized businesses and 87% of large businesses still have marketing-related spending budgeted for the next six months. However, both are waiting for state borders to reopen, employees to return to workplaces, retail locations to reopen and virus infections to remain low before they invest marketing dollars.

Businesses still have marketing budgets to spend (Source: AANA. Click to enlarge)

The research was conducted in June, surveying a total of 442 small, medium, and large businesses about the impact the bushfire crisis and COVID-19 have had on marketing spend.

With their remaining marketing budgets, SMBs are prioritising pushing short-term sales messaging in their marketing, whereas large businesses preferred long-term brand building. The AANA credited this as a “clear demonstration that Peter Field’s messaging to marketers is getting through with the balance between long and short term almost at the recommended 60/40 split”.

The next six months will also see brands invest their ad spend into online paid media as opposed to traditional media. Social media, digital search, digital video and digital display are all set to increase over the next six months, including a lift in digital online video from 6% of SMEs ad spend from January to June 2020 to 14% in July to December.

The breakdown of medias attracting marketing budgets (Source: AANA, Click to enlarge)

The research also found that across the board the biggest problem for businesses was cashflow. 85% of SMBs and 76% of large businesses claiming an average decrease in revenue for the first half of the year of 42% and 27%, respectively compared to the same period last year.

To manage the impact of COVID-19, 50% of large businesses have asked staff to take annual or long service leave, whereas 47% of SMBs’ staff have been put on reduced hours. Making do with reduced resources and staff is the next highest challenge for large businesses, behind cash flow and how to increase sales.


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