Australia’s advertising market has come into its own over the 2015 calendar year, defying expectations and an uncertain economy to deliver an outstanding 4.5% increase in advertising expenditure, taking the size of the media agency market to a colossal $7.9 billion.
Normally advertising expenditure is closely tied to economic sentiment, but with the latest RBA data showing the Australian economy growing at 2.5%, our advertisers have obviously grown their media investment at a much higher rate.
And it’s also been a year of consistent growth with higher ad spend delivered each month, with all of those small gains adding to an extra $338.6 million being spent on Australian media this year.
Benefiting from the windfall has mostly been the major media of outdoor, digital, radio and cinema media, all of which are also reporting record levels of calendar year advertising expenditure.
And in the year in which growing online bandwidths fuelled a whole new level of competition for TV eyeballs from the advertising-free subscription video-on-demand industry, Australia’s television media grew its agency advertising bookings by 0.2% from 2014 (and was only $85 million short of the record level of ad spend achieved in the 2013 Federal election year).
SMI’s product category data details at least in part how our advertising market kept ahead of economic growth, and it was probably unsurprisingly mostly due to the competitive stimulus from new products and services.
For example, the highly competitive automotive brand market – which has just reported a record level of car sales in 2015 – invested an extra $60.6 million in advertising in 2015, And off the back of this growing market the related auto dealers/parts/commercial category grew its ad spend by $29.7 million.
In a similar vein, ongoing competition within the gambling industry saw advertising for those new products and services increase by $65.6 million this year.
And an increasingly competitive movie market ensured growth in SMI’s movies/cinema/theme parks category of $43.2 million in 2015.
When those dollar increases are totalled, higher competition from individual markets alone has delivered 57% of the `new’ ad spend achieved in Australia in 2015.
Add onto that an extra $26.1 million from state election-based advertising, new Communications products growing that category’s spend by $24.7 million and higher spending from the travel sector and the picture of Australia’s advertising growth starts to come together.
The result has been a stand-out 2015 year from an advertising expenditure perspective.
And most pundits expect that with a federal election, a Census and the Rio Olympics all occurring in 2016 the growth in Australian advertising expenditure is set to continue into 2016.
SMI’s data, which details the monthly movement of ad spend across all media, media sectors, vendors and 39 product categories, will again be a critical tool for media stakeholders seeking to capitalise on the fast-evolving market in 2016.