Nine Entertainment sucked in advertising dollars from the Paris Olympics but the rest of the market is still taking small, shallow breaths.
Analysts found August numbers from aggregated media agency bookings disappointing despite the domination of heavy games advertising.
Guideline SMI reported advertising spend down 6.3% for the month, continuing the stubbornly weak, and cautiously short, media market.
The outstanding performers were Olympics partners Nine and outdoor media player QMS.
Nine achieved a second month of Olympic-related growth with its August agency revenues up 32.3%, buoyed by huge growth at both its linear TV and digital streaming.
However, the turnaround in the general market hasn’t arrived yet.
“When August is finally ruled off in a couple of months, this will be yet another disappointing result,” media analyst Steve Allen, Pearman's director of strategy and research, told AdNews.
“The hoped for turnaround in media markets has yet to arrive. However YTD down just 1.3% is heartening.”
The overall Australian economy is showing signs of life, mostly through July tax cuts, as ABS August Retail Sales showed solid growth, and the best in six months, at +4.05%.
“This is a good and hopeful sign, that the economy is commencing the crawl out of the doldrums,” Allen said. “More of this we hope. However, we cannot yet bank on it.”
Paige Wheaton, chief investment officer, Initiative, said it is unsurprising to see buoyant spend across key Olympics partners Nine and QMS.
“What has been interesting to review is that its impact on the rest of the market has been fairly limited,” said Wheaton.
“Exception to this is cinema (with a cracker of a H2 pipeline of launches to shout out about) delivering a strong near 60% growth and their best August to date.
“With the increases, when we dig deeper into the data there are also some anomalies to further consider.
“While these may be driven by delayed data reporting given the short term nature of the market, we’ve seen relatively significant declines across programmatic outdoor (-20%) and search (-15%) reported in the data.
“Throughout a year of ongoing market spend decline with clients feeling the pinch and a need to guarantee results, this seems unexpected but could shift with actualised data to hand.
“While the numbers don’t necessarily look bleak, Australia as a market remains in a fairly weak position versus the global ad market – some of this of course impacted by the US Election driving spends – but overall our GDP growth is the lowest it has been (excluding COVID) in 30 years.
“Publishers have said throughout the year that we’ve hit the bottom, but when will we see this start to lift?”
Brodie Carr, account director at Claxon, said recent data shows that brands are increasingly gravitating to events to maximise advertising budgets and reach larger audiences.
“Publishers are benefiting from this trend by partnering with major events, creating valuable opportunities for agencies and brands to plan their advertising spend strategically. This is evident in the increased spends directed to Nine and QMS during the Olympics,” said Carr.
“A proactive approach from publishers in educating agencies and brands about upcoming major events that are likely to attract targeted consumer attention will lead to better advertising spend planning and, in some cases, could even result in increased budgets when relevant opportunities arise.
“The decline in restaurant spending reflects the tightening of consumers' wallets, highlighting the importance of making every dollar count. This shift presents an opportunity for brands to move away from brand-awareness campaigns towards targeted sales promotions.
“As key retail periods like Black Friday, Cyber Monday, and the Christmas buying season approach, emphasising savings will likely become a significant motivator for consumer purchasing behaviour.”
Nick Grinberg, head of strategy at Next& Co. said August, aside from the Olympics, feels like more of the same trend.
“With some positive economic signs starting to show – for example, projected interest rate cuts projected for early 2025, and the Christmas trading period around the corner, we can hope for a reversal to this monthly decline trend,” he said.
"Streaming TV’s continued growth showcases the changing media consumption trends by Australians. These changes will no doubt influence the media mix that brands choose to invest in when more dollars pour back into ad spend."
Amy Dascanio, general manager, Media - Enigma, said the August result demonstrates that big events such as the Olympics continue to drive incremental revenue for media owners, as brands look to capitalise on key cultural and sporting moments to engage their audiences.
“The current trends in expenditure across channels are directly reflective of the shifts in consumer behaviour, and with these shifts, it’s prompting more careful allocation of ad spend. Securing attention where consumers are most active is crucial, especially in a tightened budget environment.
“From an agency perspective, we are delivering some great success with digital out-of-home, particularly from a cross-channel approach and how it integrates with our clients' digital ecosystems.”
Emilia Chambers, head of strategy, The Pistol, said the August Guideline SMI data reveals a challenging advertising landscape.
"This short market situation underscores the critical importance of holistic media planning for brands," said Chambers.
"In this context, the value of a comprehensive marketing strategy, with a focus on owned channels, becomes paramount. By developing and leveraging owned media assets, brands can reduce their vulnerability to market fluctuations and maintain consistent presence without being subject to the premium prices that are characteristic of a short market.
"Successful navigation of a short market requires an integrated planning approach that considers paid, owned, and earned media, supported by agile budget management and aligned content strategy.
"The current market conditions, while challenging, present an opportunity for brands to reassess and optimize their media mix, ultimately building more resilient marketing strategies that can weather future pressures while delivering consistent results."
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