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The advertising market is still short and unpredictable despite a significant slowing in the rate of fall, according to Guideline SMI’s aggregated media agency bookings for September.
Ad spend was down just 1.5% in September and for the first nine months of the year it is down just 0.2% or $9.7 million in a $6 billion-plus market.
The big winner is outdoor media with 15.8% growth in September to take its total market share to a record 16%.
Nicola Barnes, head of investment - iProspect, said it's encouraging to see the market heading in a positive direction.
“However, we are still experiencing a short market, which is reflected in noticeable fluctuations from mid-month to end-of-month results, therefore whether this momentum will continue is a hard one to predict,” she said.
“Some advertisers may have chosen a strategic approach to their advertising flighting this year, opting to pause campaigns during the Olympics in favour of a stronger push from September.
“Others potentially preparing to engage their customers just before the busier and more expensive Q4 months. This could also explain the rise in Outdoor investment, as advertisers focus on their branding messages slightly earlier, aiming to maximise their visibility and potentially shift to a more performance-driven strategy in Q4.
“We are definitely observing a shift towards outdoor advertising among our clients, with more brands adopting innovative formats and prime locations.
“Additionally, the flexibility of digital assets allows for real-time adjustments, supported by audience data, enabling brands to tailor their campaigns with greater precision and effectiveness.
“This is particularly important for advertisers under pressure to demonstrate ROI on their marketing budgets. Of course, this is also possible across other media touchpoints and it is positive to see that digital audio and video are also seeing growth, just being pulled back by their linear counterparts when viewed from an overall channel perspective.
“It’s also noteworthy that the home entertainment category has seen an increase of nearly 40%. The growth of various streaming platforms and entertainment options has heightened competition, prompting these brands to invest heavily in not just attracting, but also retaining subscribers and viewers.”
Media analyst Steve Allen, Pearman’s director of strategy and research, said the market is improving but only incrementally.
“Retail sales continue to slow. September (just released) +0.94%, the lowest growth month this year, and since December last year, and one of the lowest in five years or so. And this after the effects and relief of three months of tax cuts flowing into everyone’s pockets," he said.
“Consider Woolworths posting a profit downgrade, just in the last week, for this half. Other retailers also saying consumers are hard to convince to spend, and trading down in price points. Everything is not rosy in consumer land.
“SMI data definitely tells a story, that in our sector of the economy, things are on the improve.
“However a quirk of media agency turnover is that there are many meaningful adjustments post release of monthly data.
“For example, on original release of all months this year would show for the eight months to August an average monthly retreat of 3.4%. However now with late bookings, late invoicing, and adjustments, those same eight months are now ruled off at very nearly break even.
“This is a significant and meaningful improvement. The monthly adjustment swings sit around five growth points of adjustment.
“Turnover remains tough and a little unpredictable. We are yet to see a consistent surge in advertisers really stimulating the market.”
Brianna Well, head of investment, Perth, Initiative, said 2024 has seen a softened market.
"Very few clients have seen growth in advertising budgets year on year, if anything they have been reduced," said Well.
"As a young TV trader I once wished for a soft market, trying to buy TV with a four-week lead time was almost impossible - there were no avails. Fast forward 10 years and the reality of this is vastly different, the pressure on agencies and media partners this year has been immense.
"The tides are turning in Q4 though, only last week I had two different conversations with sales directors where the words used to describe Q4 were 'booming' and 'looking fantastic'.
"It is a level of optimism I haven’t heard all year, which is a sign we are heading in the right direction. Now as we gear up for Christmas retail spending, followed by the federal election in 2025, the market will no doubt see a healthy injection of spend that will keep the momentum going."
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