Aussie ad spend outperforms global growth

Nicola Riches
By Nicola Riches | 6 December 2016

The Australian advertising market is expected to outperform the rest of the world next year as local growth continues to outpace other markets.

Global ad growth will slow in 2017 to 3.6%, while Australia will expand by a further 6.3%. By way of comparison, the Australian market achieved stronger than expected growth in 2016 of 7.4%, compared to 5.7% globally.

The biggest contributors to growth this year were the US (6.9%), China (7.2%), Australia (7.4%) and the UK (5.2%).

According to Magna Australia, IPG Mediabrands’ media investment and intelligence division, the local advertising market continues to be driven mostly by digital advertising which is heading for a 65% share of total spend by 2021.

Local digital spend is likely to increase by 16.3% year-on-year in 2017, leaping to 52% of total advertising spend. 

“This persistent strength in digital growth is especially surprising because Australia is considered one of the most developed digital economies globally,” said Magna Australia managing director Victor Corones. “It means we are not seeing any slow-down in digital advertising investment.”   

However, growth in social media investment is expected to slow next year according to Magna, although it will maintain an impressive growth rate of 28.6%.

Television is expected to command 78% of total screen advertising dollars, but will witness a slight year-on-year contraction of 2.1%, as a result of a strong 2016 which benefitted from the Federal Election and the Olympics. The remaining 22% of screen ad spend will be spent across digital video, which will enjoy a 45% upsurge next year.

Radio is forecast to increase 2.0% year-on-year, while advertising dollars for newspapers and magazines are expected to contract 12.3% and 10.7% respectively.

Across the OOH sector ad spend is expected to be up +8.2%, of which most growth will come from digital assets which will see an increase of +20.7% YOY.

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