The advertising market in Australia is sending mixed signals as the slide in spend shows signs of easing.
Advertising spend, as measured by media agency bookings, fell 1.1% in June, the smallest monthly decline reported so far this calendar year. Ad spend was down 5.3% in May, 5.6% in April and 6.6% in March.
Looking at the financial year to June, the market is now up 4.5% on the pre-COVID financial year. GUIDELINE SMI’s data shows the Australian ad market ended the financial year with the value of total ad spend down 1.6% from last year’s record total.
Ben Willee, general manager and media director at Spinach, said this is a very good result given the immense amount of money flowing around agencies and going directly to retail media (north of half a billion dollars by some estimates).
“The real challenge for the media moving forward will be yield, especially in video,” he said. “We’ll be watching the SVOD and BVOD markets closely as we see significant increases in supply coming from Netflix, Amazon and Disney.
“I’m told that change is inevitable, but growth is optional. Let’s hope falling inflation puts downward pressure on interest rates and therefore improves the crucial metric of Consumer Confidence.”
Media analyst Steve Allen, Pearman’s director of strategy and research, sees a mixed month of June, half year and financial year.
“No clear signal as to recovery on the way, nor trajectory for the next six months,” he said.
The CPI number released last week, ticking down a fraction to 3.8%, was a relief, signalling that the RBA is unlikely to be forced to (unexpectedly) raise interest rates this next week.
“For the overall economy, this should mean steady as she goes but no great relief on the pressures of consumers hip pocket,” said Allen.
“Whilst the month showed one of the lowest declines, this was driven more by the really tough retail conditions, as the RBA tries to bring inflation under control and within target range of 2%-3% (presently at 3.8%).
“One of the few bright spots in ABS retail turnover reporting for June was Department Stores, up 4.59%. This, and a solid result for other retailing (comprising and includes News/Recreational/Pharmacy/Stationary/Flowers), signalled a lot of June/EOFY Sale activity by a wide range of retailers, undoubtedly a one off boost to June SMI.
“Other joy to be found was the television category down (for second month in a row) to single digit declines, just -4.8% for the month. In particular metro TV the lowest decline (-6.9%) for the half year, and lowest for 18 months.
“Over the entire media landscape, TV is still by far, the #2 medium (behind digital). Until this recovers, SMI trend data will be subdued.
“We see June as one off. July and August with Paris Summer Olympics (particularly August) will be stronger momentarily, but will not set the course for the next six months.
“Times remain tough and a little unpredictable for the media markets.”
Chris Parker, CEO Awaken, said he is seeing a noticeable shift as brands strategically allocate budgets to platforms and mediums that deliver measurable impact.
“While some advertisers are pulling back, others are doubling down on outdoor and streaming, recognising the value of preserving market share and driving revenue even in challenging times,” he said.
“It’s a reflection of the changing landscape, where only the most effective channels are getting attention. At Awaken Media, our planners and buyers have seen this trend firsthand, increasingly steering clients towards these high-impact platforms that offer tangible results.
“Outdoor advertising is leading the charge with its unique ability to reach audiences where it matters most. Brands investing in out-of-home aren’t just looking for visibility; they seek genuine impact.
“In an era where every advertising dollar must work harder, outdoor advertising offers a tangible connection with consumers that digital can’t always replicate.
“It’s about being present in the real world, making impressions that stick, and keeping brands top of mind as people go about their daily routines. With some advertisers pulling back, tactical channels like outdoor are seizing the opportunity to shine, delivering real results with precision and efficiency.
“Streaming platforms are another area where we’re seeing significant investment, driven by the power of audience buying and data overlays that enable better targeting with less media wastage. In a market where media needs to be smarter to work harder, BVOD and other streaming ads provide a way to engage consumers with pinpoint accuracy.
“As people shift their attention to digital content, these platforms offer an opportunity for brands to be seen and heard in the right places at the right times. This isn’t just a reaction to changing habits but a strategic move to maintain a competitive edge and maximise ROI.
“For brands navigating these challenging times, focusing on streaming and outdoor is essential, as they have proven to be the most effective in driving results and maintaining relevance.”
Shahram Ghaffurian, Global CEO at independent media agency Magic, said the SMI results show resilience.
“To finish all but flat to a record breaking year and 4.6% ahead of pre-COVID FY despite the relentless assaults on consumer cash flow and confidence says that this is a market of core strength that shows signs of promise for the year ahead,” said Ghaffurian.
"With the continued declines in traditional channels it's clear the money is moving with the audience as consumption behaviour continues to shift towards demand driven content.
"Magic's modelling has shown that the leading metric of any format to drive an incremental business outcome is whether it can attract and hold audience attention.
“The strong growth we are seeing in digital audio and video reaffirms the strength of high attention formats and further highlights the convergence of media channels we are continuing to see in the market.”
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