Media agencies have backed a positive forecast for ad spend recovery by the industry body, the Independent Media Agencies of Australia (IMAA)
The indies see a crack of optimism lift from the ad spend gloom of the past year, despite continuing negative numbers from booking data gathered by SMI (Standard Media Index).
Half of the nation’s independent media agencies expect ad spend to increase in the financial year starting July, according to the IMAA Indie Census for June.
Chris Parker, CEO at Awaken, has seen an adjustment in media forecasts extending to the end of 2024.
“With consumer spending down, some verticals have adjusted their spend this year,” he said. “However, the financial, health, and tourism sectors have continued to hold or even grow their investment.
“We are seeing renewed optimism for 2025. Once the dust settles from the RBA’s decision in November, and we assess the impact of Black Friday, Christmas, and Boxing Day, we’ll have clearer indicators on whether stronger consumer spending will return in 2025, potentially leading to increased spend.
“Indies are inherently optimistic—it’s in our DNA. Being closer to the pulse of challenger brands allows us to pivot quickly, giving the brands we work with a competitive edge.
“This agility likely explains why many of us are optimistic for the year ahead, despite the economic challenges. If any agency can drive sales and growth, it’s an indie.”
Claxon reports the positive forecast for ad spend recovery is reflective of the conversations it's having with clients.
And this indicates a healthy market rebound, benefiting both agencies and clients.
“The anticipated growth in digital video and BVOD/CTV is unsurprising and indicative of shifting consumer behaviour towards online platforms/digital consumption and the rise of streaming services, on-demand content, and the increasing penetration of smart TVs and mobile devices have also fuelled this change,” said Danny Molyneux, general manager.
“With audiences spending more time on platforms like YouTube, Netflix, and social media, advertisers are naturally following suit. The growth in digital video and BVOD/CTV supports the trend as well, as these formats offer the ability to engage viewers with high-quality, targeted content.
“This optimism signals that clients are ready to invest more in digital channels, seeking better ROI and effective targeting. The second half of the year looks promising, driven by increased confidence and strategic investments in performance-based channels like paid social and SEM.
“The key to success will be finding a balanced approach between demand generation and demand capture, ensuring that this increased lower funnel performance investment is also supported with healthy awareness investment.
“This optimism is not just about recovery; it represents a strategic shift towards more effective and efficient advertising practices that are aligned with modern consumer behaviour and highlights IMAA’s positive forecast for ad spend recovery as being well-founded and reflective of current industry trends.
Ori Gold, CEO & co-founder at Bench Media, said the media landscape is experiencing a shift.
“We're seeing a rise in both budget and strategic commitment, with a focus on full-funnel investment expected to materialise throughout the second half of 2024 and into 2025,” he said.
“This comes alongside a recognition from brands and executives that true growth requires a holistic approach. Building brands alongside performance-driven activities is key to maximising return on investment.
“Correspondingly, budgets are expected to migrate from traditional linear TV to BVOD, AVOD, and digital video, as well as a diversification away from the Meta-Google advertising duopoly.
“Rising prices and strong alternative solutions are driving this shift. Finally, with privacy laws and cookie depreciation on the horizon, expect brands to invest heavily in first-party data solutions to maintain a competitive edge.
“It's a dynamic time for marketing, with a focus on strategic investment and a move towards more diversified channels and platforms.”
Aishling Farrell, general manager and head of strategy at Orange Line, is seeing clients increasing their media spending across the board.
“Those who pulled back earlier this year have experienced the consequences, and we are heading toward a correction of sorts,” said Farrell.
“Spend allocations are shifting from offline to online as agencies are encouraged to move more of their Total TV budget to ad-funded streaming and as many offline media types continue digitising.
“We are also seeing many longer-term projects delayed this year due to tight budgets retake centre stage.
“We expect more briefings and pitches on web builds, analytics, CRM/ First Party Data strategies, and additional AI-related programs in the coming months.
Jaime Nosworthy, Chief Executive Officer, The Pistol, said the year ahead is about forecasting the impact of the entire marketing mix to pull levers to accelerate growth at times of opportunity.
“While performance investment is forecasted to grow, we’re working with our client partners to invest in the long-tail as well, improving the defensibility of their brands in the year ahead with intentional and efficient brand building with robust full-funnel measurement,” said Nosworthy.
“It’s no surprise that the growth is expected to come from digital channels, but for us, the intersection of paid and owned channels is really where the opportunity for long term, sustainable business growth lies.”
Alfie Lagos, director, LexLab, said there’s optimism around digital video and BVOD/CTV growth, with nearly 70% of agencies expecting significant increases, despite the cost of living pressures and shaky consumer confidence.
“With the economy feeling tighter than a pair of jeans after the holidays, it's no shock that ad dollars are gravitating towards performance channels like SEM and paid social,” said Lagos.
“These channels are the go-to for delivering measurable returns when every dollar counts, and it's clear from the IMAA Indie Census that indie agencies are on the same page.
“The rise of commerce media is poised to revolutionise video advertising, integrating ecommerce capabilities within video ads and combining brand building with direct response.
“Independent agencies need to juggle the benefits of traditional out-of-home with the flexibility of programmatic OOH, especially since almost 60% are planning to boost their investment in programmatic channels. In these unpredictable times, flexibility is king, and programmatic OOH offers the adaptability that many clients need.
“For those solid-as-a-rock clients, long-term traditional OOH commitments can pay off. But for the clients who need a bit of wiggle room, programmatic OOH is the best bet.
“The introduction of MOVE 2.0 enhances OOH measurement, making it easier for agencies to justify the spend, though the minimum spend thresholds could limit its relevance for smaller budgets. In a tight, more volatile market, I suspect programmatic OOH will be the preferred option for us indies.”
Nick Murdoch, managing partner, Yango, said independents are less subject to macro-economic conditions and more to the nature of their client base.
“With indies continuing to win solid clients, it leaves room for optimism in our sector which can be seen in the Census results,” said Murdoch.
“Channel wise, out-of-home is making it easier to buy big audiences with automation and improving programmatic platforms, so we’re seeing that channel as a natural partner to digital-heavy campaigns, which is where most of our clients’ spends are headed.
“The evidence of that can be seen in the performance of Australian media companies which continue to leak oil to the global platforms, and local media companies are getting smashed right now.”
Sally Lawrence, executive director, media, Enigma, said it’s no surprise that the Census revealed forecasted growth in channels that have converged from traditional to digital like programmatic outdoor and video on demand.
“The market is reactive, and clients don’t want to take risks at the moment, that is why we’re leaning into digital channels where there is less wastage through the ability to be more targeted, where there is a more seamless connection into performance channels, and where it is easier to prove ROI,” said Lawrence.
“There is great opportunity for the radio guys to ride the coat tails of their outdoor and TV friends a bit more to push more of their data-led targeting capabilities, particularly in the podcast space which clients continue to have an appetite for.
“The Olympics is likely to give linear television a much-needed boost, and it’ll be one to watch as to whether this is short term, or whether this is a catalyst for further growth in this channel through to the end of the year.
“Enigma’s investment into regional outdoor has always been healthy, but we’re excited at the ability to measure reach and frequency for planning purposes with the rollout of MOVE 2.0. This is less valuable for our regional clients, but could be a good driver for metro-based clients that are looking to extend their presence into regional markets.
“In a tough market where the pressure is high, our priority continues to be working with clients on measurement solutions. This is fundamental to channel selection and solidifies our channel forecasts."
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