Advertising spend in Australia is expected to pick up pace in 2025 and grow by 3.7%, according to GroupM analysts.
This compares to total ad spend in Australia ending 2024 up 2.2% to $US17.5 billion.
A federal election in 2025 will likely lead to increases in ad spending, with between 150%-160% growth in the political category expected year-over-year, according to GroupM end of year forecasts.
The forecast aligns with that of dentsu which sees the Australian advertising market growing 3.8% in 2025. MAGNA is more upbeat, forecasting Advertising spend will grow 6.5% in 2025.
“Despite the ongoing cost-of-living crisis dominating headlines, the Australian ad market remains resilient, though minimal growth projected in 2024 reflects continued caution,” said Melissa Hey, GroupM chief investment officer.
“While consumers are growing more optimistic about the broader economic outlook, this sentiment may not fully translate to increased ad spending in the short term.
“Tax cuts implemented in July 2024, combined with energy relief measures, could boost consumer spending and reignite inflationary pressures.
“The outlook hinges on a potential interest rate cut in the first half of 2025. These economic factors, along with federal election ad spending, will be crucial for sustaining growth momentum in the coming year.”
At GroupM, the analysts forecast pure-play digital growing 5.1% to $12.5 billion in 2024, followed by a 5.4% rise in 2025.
Retail media will grow 26.5% in 2024, hitting $US1 billion in revenue for the first time. By 2029, the analysts forecast revenue will reach $US2.7 billion for the channel.
Search growth is forecast at 3.2% for 2024 and 4% for 2025. Other digital growth is 3.8% but dips to 3% next year.
Total TV ad revenue,including streaming, for 2024 will slide 8.2%, dragged by an 11.7% decrease in linear TV.
The GroupM analysts see steady declines for linear TV over the next five years.
Streaming TV will grow 15.3% in 2024 and is projected to grow another 24.8% in 2025.
“Even with steady increases in CTV, we project the total TV market won’t return to positive performance until 2026, driven by a 24.4% increase in streaming TV that year,” said the analysts.
Outdoor media will grow 7.3% in 2024 to $S861.6 million. Steady growth, powered largely by DOOH will bring total OOH to $1.0 billion in 2028.
DOOH will grow 9.3% in 2024 and is projected to grow another 6.8% in 2025.
Print/Audio Newspaper ad revenue will decline 10.5% in 2024, while magazine revenue is expected to fall 7.6%.
“Newspapers aren’t expected to return to growth in the next five years, but there’s a glimmer of hope for magazines, which might see an increase in 2029,” GroupM said.
“Audio will decline 0.1% in 2024, but is likely to see some modest gains over the next five years as digital audio, which climbed 16.4% this year, continues to grow.”
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