ANALYSIS - A record ad spend year ahead as cinema takes off and outdoor bounces

Chris Pash
By Chris Pash | 4 March 2022
Credit: Corina Rainer via Unsplash

The latest booking numbers from media agencies show how far cinemas and outdoor media have come since the depths of the economic fallout of the pandemic.

Standard Media Index (SMI) analysis for January has outdoor media ad spend up 18.6% compared to the same month in 2020.

That’s just $1.8 million below the pre-COVID January 2019 total.

And cinema is surging, with ad revenues up 81% in January. When looking at the first seven months of the financial year, cinema has tripled compared to the same months the year before.

The overall ad market, as measured by media agency bookings, is now 5.1% higher when measured against January in pre-pandemic 2019.

And the value of advertising revenue rose by 15.4% in January compared to the same month the year before.

Will the strong run higher continue this year?

Steve Allen, Pearman's director of strategy and research: "Yes, 2022 will grow yet again with some mediums still yet to fully recover and get back to 2019 levels.

"Radio, outdoor, cinema, and magazines also with a way to go, yet strong readership recovery recorded by Morgan Research earlier this week."

Whilst January was and is unique this year, the run of February to April will also be elevated due to governments.

"Post May we forecast lower growth but 2022 will be a record year even with global instability."

Industry insiders say the lift in January is due, in large part, to the Australian Open tennis season in January.

And for the first time, government was the market’s largest category spender in January after lifting the value of its media investment by 51% year-on-year as various authorities continue messaging in response to COVID.

More to come from government with a federal election due in May.

Sue Cant, head of media at AFFINITY: “The latest data show no major surprises across digital, and these are the results that we would have expected to see for the TV market given the return of the Australian Open tennis.

"The clear standouts are the resurgence of cinema after the lift of restrictions, and the buoyancy back in the OOH market.

“It’s great to see OOH continuing the upward trajectory in 2022 and this can only continue with MOVE 1.5 carving the way for far easier trading with standardisation, transparency, and more accurate measurement.

“From a category perspective, the dominance of Government is not unexpected, but we can see that automotive is clearly still struggling due to supply.”

Paul Wilkinson, head of commercial at Half Dome: “It’s another great result overall for the ad market, given the 15.4% increase. However I would suggest a large amount of this growth was due to the tennis in January 2022 vs February 2021.

“Even still, the fact we have further significant growth is no doubt a positive for the industry.

“From a channel perspective, it is not overly surprising to see that outdoor is bouncing back to life now restrictions are easing across the country.

“More long term, I very much expect this to be an area that will continue to have strong results – both due to the return of outdoor audiences, but I also believe that the demand for TV is now becoming unsustainable when faced with the continued declines of audience; the obvious knock-on effect being that the levels of inflation across TV are astronomical.

“It is somewhat surprising to see that radio is still lagging in terms of revenue growth, but again, I would envisage that this will be a channel we will start to see growth in throughout 2022 – time will tell.”

Sam Buchanan, general manager at IMAA: “With a looming federal election, government spending will increase significantly, even above its already high levels, which will see the ad market rise again in coming months.

“Advertisers are capitalising on changed consumer behaviour during COVID, which saw a huge shift to online many channels. Digital audio has experienced huge growth as has BVOD, digital video, and no doubt outdoor with its rapid digitisation.

“This will continue throughout 2022 with the independent media agency sector also driving growth in digital revenues.”

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