SMI: Record month for outdoor and radio masks weak results in other sectors
Ad spend in October was up 0.9% year-on-year, after a disappointing September in which it dropped by nearly 5%, with outdoor and radio reporting record revenues for the month.
Overall the market is up 1.4% year-to-date, according to the Standard Media Index’s latest figures which showed total media agency spend in October totalled $688.9m, with outdoor and radio leading the charge in growth with gains of 36.6% and 13.5% respectively.
According to SMI, these gains are due, at least in part, to timing with an extra Monday falling in October 2016 which resulted in an extra campaign loading period for outdoor and a higher-than-usual level of week-commencing campaigns for radio.
SMI AU/NZ managing director, Jane Schulze, described it as a solid result.
Jane Schulze: October was a record month
“October 2015 was also a record for month of agency ad spend having lifted eight per cent from the 2014 result, so for the market to deliver even more ad dollars is evidence of a growing confidence,” she said.
“And this result will improve even further once late digital bookings are collected at the end of the month.”
On the strong performance of outdoor, Mediacom chief investment officer Nicole Turley told Mumbrella: “It’s not a great surprise really, out-of-home in particular is doing really well at the moment, most of that is driven by the up-take of digital panels.
“It is also a big period for them being summertime, that quarter being retail heavy, they generally see an uplift. I’m not surprised by the growth they’re having, they’re doing really well with innovation and digital.”
But while perennial strong performers outdoor and radio did well every other medium was down, with digital dropping 6.6%, newspapers down 22.2%, magazines down 17.% and cinema down 21.2%.
TV was also marginally down, with media agency spend for metropolitan free-to-air stations dipping 1% for the month, although spend on regional TV was up by 0.3% and spend on pay TV was up 6.6%.
Nicole Turley: A flat result for TV is positive
Turley said: “The TV market is really volatile at the moment so to come out with a close to flat result is really positive for them. The market is really short and what we are seeing is a lot of money coming out of television going into digital and out-of-home.
“So to have a flat result in what’s been short-term bookings is good for them, hopefully this will see a positive change for them moving into November and December being high retail periods.”
Ten was the big winner, picking up more than 9% in revenue from rivals Seven and Nine; however, the network still lagged behind in revenue share at 25.3%, up from 22.9% in October 2015.
Seven was down about 2% year-on-year in revenue, with a share of 38.7%, flat on October last year, while Nine was down about 8% on revenue with a share of 36%, down from 38.4% in October 2015, despite dominating the ratings for the month.
Looking ahead to the end of the year, Turley said: “We’re certainly not going to experience the traditional uplift of a few percent in my view in what we would normally see at this time of year.”Retailers are quite cautious in what has been going on, consumer spending is quite low, so is consumer confidence.
“Off the back of the Australian election and the US election, there is a lot of nervousness or hesitancy out there in terms of spending. I think we will have a couple of percent growth when you roll up the back quarter but it certainly isn’t going to be big figures.”
Miranda Ward worked for Mumbrella from 2013 to 2017, eventually becoming deputy editor. Miranda joined Mumbrella in September 2013 from Sky News.
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