Newspaper advertising spend revealed to have fallen by a third in August
August was a tough month for the media industry across the board, with newspapers suffering the worst decline in demand from media agencies, new data from Standard Media Index indicates.
In comparisons which look worse because of healthy cyclical spend in August last year, agency spend on behalf of clients was down by 32.7% for print newspapers and by an even worse 35.4% for their digital offerings.
Magazines and radio saw majors drops compared to the same month a year ago, down 27.7% and 14.3% respectively.
The magazine category’s digital spend fell 23.5%, while print fell 28.4%.
Digital radio fell more than traditional radio, down 27.1% year on year compared to 13.7%.
Radio’s decline was attributed mainly to an extra week-commencing period which fell in August last year, meaning four weeks this year are being compared to five weeks in the same period of comparison in 2016.
Television was down 6.1% in total, however digital media spend in television was the only category up year on year, by 26.1%.
Outdoor media agency ad spend dipped by 5.8%
Cinema, dropped 32.8% on the previous year.
According to SMI, the major declines were primarily due to the Rio Olympics and the 2016 Census.
Total estimated ad spend for the month was down 12.1%, to $526.5m.
Schulze: It was always going to be tough
Jane Schulze, SMI Australia and New Zealand’s managing director said: “The 2017 year was always going to be tough given the large significant events occurring last year such as the Federal election, Rio Olympics and Census,’’ she said.
“As a result we’ve only had two months in 2017 in which we’ve reported year-on-year growth – January and March – but we’re hoping a period of more normal comparative periods is now ahead of us.’’
The restaurants category was the only one where total media agency ad spend grew for August, up 5.3%.
The large spending categories of automotive and retail fell 3.6% and 11.9% respectively.
Why do I immediately think of Domain? Because Fairfax’s geniuses are in the throes of pushing our the offer for the float? Or because the private equity exercise revealed a large hole that could not be explained? Answer: both.
Hywood and his mate Catalano have one leg over the barbed wire fence, and I suspect they’ve only just noticed the spiky sensation. Put simply: Domain is not a digital business, but a brand spread over all of Fairfax media. In many ways it’s an accounting invention. Its biggest driver is an almost incomprehensible real agent equity incentive that goes into the Fairfax balance sheet.
Anyhow, the whole allure is based heavily on two thoughts: that the newspaper business can keep delivering and that the market buys the Domain separation. Unfortunately, the first part is looking very very doubtful, which raises the question of the second.
If Domain is to be a separate ASX listed business, what’s left in Fairfax? Fairfax shareholders will be very interested to see what the prospectus brings. I hope ASIC is looking too. It might be time to engage that illustrious Fairfax board of directors, even if the genius behind Hywood has now turned his attention to gay marriage (not).
User ID not verified.
Wow. Those year-on-year revenue drops for Newspaper (and magazine) businesses are not mellowing at all, they are just getting steeper. One very significant development here: their digital revenue — once held up as the thing that would help compensate for hemorrhaging print dollars – is now deteriorating faster than print revenue. The outlook is bleak indeed.
User ID not verified.
Do markets REALLY move this much in a single month, or is it the measurement of the market that does?
User ID not verified.