Agency bosses pessimistic about quarter three bookings

With Standard Media Index (SMI) figures for August set to be released next week, leading media buyers have argued the numbers will be disappointing, despite the Olympics.

Agency heads have unanimously agreed August SMI numbers, which measure bookings made through media agencies, will be poor, and that figures will continue to be low throughout the rest of quarter three.

However, the outlook for quarter four has remained a point of contention.

Aegis Media Pacific executive chairman Harold Mitchell told AdNews that despite a relatively strong economy, a lack of consumer confidence is hampering the advertising industry.

“We expect August figures will show a drop,” Mitchell said. “There is a lack of consumer confidence which feeds into advertising. It's tragic to see this.”

When asked if the fact the Olympics was in August would have any impact, he said: “The Olympics won't boost August.”

ZenithOptimedia chief executive Ian Perrin also argued the Olympics would not bolster poor figures for the month.

Perrin said: “We expect the August results to be similar to July [which dropped 7%]. The numbers may even be worse, which is quite a surprise given it is an Olympics years. But the Olympics won't have a huge impact, there might vbe a small impact in some areas but this will be offset by softness in other areas.”

Starcom MediaVest chief executive John Sintras also pointed to a flat market, He said: “I expect the August figures to be flat. Second half growth for the year won't be strong.”

Mediabrands executive chairman Henry Tajer argued August will be stronger than July, but will still be in the negative figures.

“It will be a stronger month than the previous one,” Tajer said. “But it will be a shitty quarter. September will be high single digit decline.”

Tajer went on to say the fourth quarter will not be any better. “I don't see the fourth quarter getting any rosier. I'm not seeing anything too good in October, it is lumpy and unreliable. November looks like it might be a mildly happy month, but December is only half a month.”

However, Perrin argued it was harder to determine the outlook for quarter four. He said: “The rest of quarter three will be flat but we may have a different quarter four. It is too early to tell though, because the market is so short.”

In July, SMI figures indicated a 7% drop in total media agency bookings.

The market also showed a 5% decline in digital. Both Tajer and Perrin said this will not be repeated in August, and was just an “anomaly”.

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