A survey on the spending intentions of advertisers shows there are still deep budgets waiting for an opportunity for media spend.
According to research commissioned by AANA (Australian Association of National Advertisers) and market research firm IPSOS, 68% of small to medium businesses and 87% of large companies still have marketing spend budgeted for the next six months.
Most say releasing the budget will depend on when retail locations, national and state borders reopen and when employees restart regular work patterns.
As a result, 50% of both large and small businesses have marketing budgets sitting on the sidelines waiting to be committed at some point in the near future.
John Broome, CEO of the AANA, says advertisers large and small are still sitting on uncommitted budgets.
“So there's a lot of potential for growth in media spend if those advertisers are confident about committing that,” he told AdNews.
“They are waiting for better times and the key question is nobody knows when those better times will come. So when do you commit?”
Broome’s view is that the courageous marketers will make a commitment and go for growth.
“Others run the risk that sitting on that cash will just mean it will just drop to the bottom line and they'll pass up the opportunity for potential sales growth,” he says. .
“A tricky situation. This is really about spotting the opportunity, making the commitment, backing yourself, and getting the results against a very, very uncertain, ever changing marketplace environment."
The survey asked 442 small, medium, and large businesses about the combined impact of the bushfires and COVID-19 have had on marketing spend and their media preference in the next six months.
The larger businesses are more committed to investing marketing spend behind long term brand building, while smaller companies have more of a priority to short term sales.
The research also found that the trend to online channels will continue and it’s share of total media spend will accelerate as a result of the current economic crisis.
Consumer uncertainty caused by new lockdowns and COVID hotspots will likely only exacerbate this as the population becomes less mobile.
As a result, most Australian businesses are more likely to use and continue to use online paid media over traditional media.
The research found a significant impact on business revenue in the first half of 2020.
For small to medium sized businesses (SMB), most (85%) had an average fall in revenue of 42% compared to the same six months last year.
Three-quarters (76%) of large businesses had an average decrease of 27%.
SMBs were more likely than larger businesses in having to close or stop operating temporarily as a result of the current crisis.
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