A flat year for advertising spend growth in Australia saw major shifts in where marketing dollars are landing.
While linear TV slips, BVOD rules, outdoor media grows and cinema gets the love from audiences.
Guideline SMI reported the total value of annual agency bookings to be down just 0.9% over the 12 months.
Digital and outdoor media gained record market share. Cinema also achieved impressive growth.
Video Sites/Streaming services recorded 17.8% growth and advertising demand for digital radio soared 17.4%.
However, the latest SMI numbers, plus coming federal and state election spend, coupled with a trade war out of the US, spells a flat outlook overall.
Justin Ladmore, managing director, media, at Enigma, points to significant shifts in channel spends that paint a compelling picture of evolving advertiser priorities and what is to come in 2025.
“Lifting consumers' emotions after some tough years was an evident strategy in 2024 with channels such as video and cinema seeing growth,” he said.
“The standout performer of video sites/streaming services surged and continues to steal share from TV as viewing habits shift to on-demand content.
“This growth will continue this year on the back of increased consumption of video and the ease and more affordable video production options in the market which was a big barrier for clients only a few years ago.
“I loved the cinema result. So happy to see it clawing its way back. There is nothing better than seeing your ad on the biggest screen of them all. The biggest emotion-evoking channel there is. The biggest fear for cinema is retaining the younger audiences who these days seem to get bored of any content over six seconds.
“No surprises that outdoor continued its growth trajectory delivering high-impact, brand-building visibility in an increasingly fragmented market. Digital outdoor inventory and programmatic buying have opened up a new world of revenue for outdoor companies now appearing on digital-only schedules and used as a reach driver at the top of the funnel.
“If driving emotion continues to be a strategy in 2025, channels like video and cinema should continue to perform and there is a real opportunity for TV to capitalise on this. However, TV must evolve quickly to remain relevant in this rapidly changing landscape.”
Kristiaan Kroon, COO, OMG Australia, said low visibility and high volatility across the 2024 ad market means historical numbers are only telling a small part of the story.
"Context is key: The low growth environment with no good news for Household for nearly two years underlines this result as a resilient ad market
"2025 will see growth driven by steady interest rate cuts and a federal election but expect gradual change similar to the UK rather than a sharp US style rebound."
Lee Stephens, executive chair at Meerkat Media, said ACMA’s mid-December launch of Communications and Media in Australia report clearly highlights TV as a media channel in transition.
Important 35-44 audiences continued to increase viewership in paid subscription and BVOD with only 30% of this same audience viewing FTA linear TV over the survey period.
“That is not to say there are not clear winners hiding within TV’s mixed results for 2024,” he said.
“Nine Entertainment claimed BVOD revenue share growth to 47% in FY24. Nine’s commitment to the Nine2028 Strategy and investment across 9Galaxy and 9AdManager has paid off against direct competitors. Nine’s higher market share creates more data, better targeting and locks in very real long-term advantages for the group.
“The real issue for incumbent BVOD players is meeting the skyrocketing demand and volumes required to compete across the broader video campaign landscape.
“In 2023 I asked a Head of BVOD executive if poor frequency capping was damaging viewers’ experience and potentially damaging brand experiences. His reply was simple: we know it’s not perfect however every ad we don’t serve is revenue we give to YouTube. Despite impressive internal revenue growth among BVOD providers, the market’s appetite is outstripping supply.”
He said that while it’s easy to point to digital innovation as the only driver of OOH market share, there are other factors at play.
“Urbanisation, the spread of our cities and enormous investments nationally across infrastructure and transport networks have all created ground-breaking opportunities for OOH, powered by new and connected technologies.
“New connected digital and interactive street formats have created a new benchmark in commanding and holding attention. Added to audience interaction measurement, hyper targeting and reach tracking DOOH provides advertisers with one of the most reliable ROI predictors in-market.”
Media analyst Steve Allen, director of strategy and research at Pearman, said December is one of the more volatile months of the year, and often has some of the greatest adjustment to the final figure due to early agency invoicing because of the Christmas break.
Last year (December 2023) saw a five point adjustment upwards as late bookings and reconciliation took effect.
"And December 2024 will most probably only be just negative by 2-3 points," he said. "Regardless, December is not great at all, the largest fall for the year.
“However, with most of the market, especially retail, predicting a pull-forward of sales to pre Christmas sales and discounting, and Black Friday, many clearly softened their December activity.
“At the same time consumer confidence was bouncing around, but clearly trending nowhere, and the early euphoria of tax cuts had clearly washed away. Thus from a consumer point-of-view…nothing to get too excited about.
“SMI quite rightly point out that, in trend for the year, comparing to the past three years, most probably the worst is over for the media markets. We forecast in AdNews annual, the year would be just negative overall.
“We say yes but it will not now trend to better. It is our belief the overall market trend will be only a fraction better than 2024 in 2025, nothing material.
“And now we have the commencement of global trade wars.
“With the Federal Government election this half by May, preceded by the WA government election in March, there will be some pull forward of advertising activity.
“With RBA rate cuts during the 2025 year (maybe three) consumer sentiment, and their ability and confidence to spend, will bubble upwards. This will keep the media markets just positive, but by no margin.”
Amy Carr, general manager - growth, Yango, said the key trend is the surging popularity of video content, reflecting evolving consumer preferences for engaging visual experiences.
“We're seeing impressive engagement and completion rates for our clients leveraging streaming platforms and are regularly recommending it as an addition to our video offering.
“Traditional media, namely linear TV and broadcast radio, will continue to face headwinds due to the growth of digital platforms and shifting consumer habits. However, we expect the upcoming election year will provide a welcomed boost to their revenues.
“Despite ongoing discussions surrounding brand safety on social media platforms, we anticipate continued growth in this space. Our clients are becoming increasingly sophisticated in their approach. We're seeing a greater focus on creating content that is genuinely platform-appropriate, alongside a rise in influencer marketing strategies
“Market conditions appear promising for a recovery and growth in 2025. As inflation gradually comes under control, consumer confidence is expected to rise. Coupled with the potential for interest rates to be reduced in the first half of 2025, this could put some money back in people's pockets and increase spending, which is a more favourable environment for advertising.”
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