The advertising industry is hitting the end of calendar 2021 with increasing confidence, as the ad spend canary soars higher than expected and better than pre pandemic 2019.
Media buyers see this continuing into 2022, with at least a strong first half ahead.
The October SMI (Standard Media Index) numbers are 1.6% above ad spend in pre-COVID October 2019 and 2.7% on last year.
Cassie Longmuir, Client Solutions Director Half Dome: “I think the biggest call out about the increase in SMI results is the confidence that’s been built within the advertising industry.
“The advertising lull we had during the pandemic is now bouncing back, quicker than what the experts were saying, with nine consecutive months of higher ad spend than pre-covid times.
“As we come into one of the busiest marketing periods of the year, I look forward to seeing the industry only continue to grow and succeed on the results of 2019.
Ben Willee, general manager and media director, Spinach: “No great surprise that year on year numbers for October have flattened.
“Very interesting times in advertising market at the moment. Lots of demand and challenges for buyers and sellers (especially in fixed inventory mediums) to get to grips with post pandemic lead times, availability and rate.
“While consumer confidence remains strong and lockdowns stay in the past, we expect the market to remain strong for the foreseeable future.”
Nick Durrant, MAGNA Global’s managing director: “The strength of the October spend numbers is probably a strong indicator of the potential strength in the market for at least the first half of 2022, (assuming omicron does not put us back to square one).
“Throughout the quarter it was apparent that ad spend had not been impacted anything like in 2020 by the lockdowns in NSW and VIC. Consumers were prepared to spend and we did not see wide scale job losses.
“This is reflected in the Q3 GDP numbers where the decline experienced of 1.9% was significantly better than market expectations of 2.7%. What is perhaps more pertinent is that the HH savings ratio lifted to 19.8%. This signals that consumers have money in the bank and we know that once they are given the opportunity to spend it, no more lockdowns, they will.
“Global experience shows that as countries move past lockdowns into a living with COVID model ad spend generally surges. We would expect this surge for the rest of this year and into the first half of next.”
Joanna Fawkner, Zenith Head of Investment – Melbourne & Brisbane: “The October SMI results are very encouraging, and an indication of what should be a strong final quarter for the year. This is well overdue, as we haven’t seen total market growth of this kind in Q4 since 2017.
“Outside of digital and television, some mediums such as outdoor, radio and cinema still have a way to go to return to their pre-COVID benchmarks. That said, we are seeing good momentum month to month, and I’d expect to see that strengthen as we move through Christmas and into the new year.
‘We expect the current levels of demand to continue well into 2022. With anticipated increases in investment across categories such as auto, travel, retail, as well as a federal election – these positive market results should continue.”
Cassie Longmuir at Half Dome: “An exciting increase in ad spend this October, with SMI results growing by 2.7%. Again, no surprises this month, digital continues to be the key driver of growth with further traction in the social media sector.
Australians are now accustomed to streaming live sports, news and entertainment through connected TV or BVOD channels, the increase in digital video (4.5%) makes sense.
“Excitingly, the OOH sector has seen growth of 12.7% MoM; this shows that clients are confident that we, as a country, are through the worst of the pandemic and will no longer be forced into lengthy lockdowns.
“I think it also shines a light on the success of OOH companies, by being nimble when traditionally rigid, and by building trust with brands in providing significant value.
“As we continue to see growth in the digital vertical, one thing for all clients and agencies to keep a close eye on is the audiences that we are all trying to reach as they will continue to diversify and become increasingly fragmented across multiple environments.
“The question we should always be asking ourselves is, how has the media consumption behaviour changed for our audiences? rather than, is there a place for traditional media on our marketing plan?”
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