MAGNA, IPG's media investment and intelligence arm, has just released an optimistic outlook, driven by digital channels, for advertising spend in Australia for the rest of the year.
Total advertising revenue will grow 7.3% to $A28.9 billion in 2024, a significant uplift from the 3.8% estimate made in December, according to MAGNA’s mid year Global Ad Forecast numbers.
The outlook is well above the estimates of other forecasters, and well ahead of MAGNA's forecast made in December of 3.8% for 2024 and an improvement of MAGNA's estimate of 5.7% growth in 2023.
The optimism is a contrast to other forecasters who have been anticipating a just above the line result for ad spend in Australia.
GroupM sees overall ad revenue up by a “modest“ 1.1% to $23.5 million in 2024 before stronger growth returns in 2025.
And dentsu forecasts Australian ad spend growing at 1.8% in 2024 (versus –0.8% in 2023) to $US13 billion, a downgrade from the 2.3% forecast made at the end of 2023.
And SMI (Standard Media Index) numbers have been showing Australia's advertising market lagging that of the US, Canada and the UK. So far this calendar year, the market is down 1.9%, according to aggregated media agency booking numbers.
Globally, MAGNA says media spend was stronger than expected in the first half of the year. It now forecasts global media owners’ advertising revenue to grow 10% to $US927 billion this year and 8.5% in APAC.
MAGNA predicts ad spend in Australia will keep going at a rate of 5.8% a year to 2028.
“We’re seeing so much volatility across the market but we are forecasting media spend growth this year when you look at the total market,” said Lucy Formosa-Morgan, managing director, MAGNA Australia.
"And this growth will be driven purely by digital channels and digital extensions of traditional categories. Social, Search and Video will be the winners in 2024."
For 2024, MAGNA forecasts digital advertising to account for 77% of total advertiser budgets, with search up by 9.5% to AUD 10.9 billion.
Social media ad revenues to increase by 19.4% to AUD 7.7 billion and digital video by 7.6% to AUD 2.4 billion.
Static display advertising revenues are expected to fall by 1.8% to AUD 400 million. Mobile advertising will represent 75% of total digital advertising budgets.
Traditional media owners' advertising revenues in 2024 are projected to be down 5.4% to $A6.7 billion ($4.4 billion).
Television ad revenue is expected to fall by 11.6% to $A3.5 billion.
Publishing advertising revenues are projected to decline by 10% to $A600 million.
Audio advertising will grow by 3.2% to $A1.2 billion and outdoor by 7% to $A1.3 billion.
MAGNA forecasts:
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