Brands are expected to spend big in the lead up to the Christmas advertising frenzy.
Lucy Formosa Morgan, MD at MAGNAGlobal, says the local ad market has been slower than expected this year.
However, strong investment from brands is expected into the end of the year.
AdNews spoke to Lucy Formosa Morgan about the market, the state of the nation with agencies:
What is the biggest hurdle at the moment for agencies?
Our biggest hurdle is also our biggest opportunity…how do we embrace all available means to build efficiency into our business, using technology (including AI), machines and automation?
After several years of investment and development work, we’ve launched eight bots across Mediabrands which now handle the majority of the menial tasks of media buying such as post matching, data loading, etc.
We’re now exploring the use of generative AI, or smart technology across all areas of the business – from tender submissions through marto predictive analytics, targeting, real time optimisation and so forth. It requires investment, time and an appetite for change but if we don’t challenge ourselves now, we run the risk of being left behind in what will no doubt be a different playing field in a few years’ time.
The market is said to be slow, with brands cautious in an uncertain economic climate. What are you seeing out there?
I think that’s very true. Driven by global and domestic economic uncertainty, it has definitely been a slower year than we’d anticipated. However, we are starting to see the market pick up as we move into Q4, with demand getting stronger across all channels. Q4 last year was when the market started dropping off, so the comparisons will be off a lower base when evaluating year on year performance.
In terms of where that demand is coming from, it’s from across a number of categories, particularly travel, automotive and increasingly government / political with the referendum now bringing additional investment into the market.
Over the last few years, Black Friday / Cyber Monday have become increasingly more important to retailers (and consumers) in Australia, so we’d expect to see strong investment again over this period and then into the lead up to Christmas.
The WFH revolution. What are the pressures from staff on this? Is there an ideal hybrid working model (days in office Vs home)?
I don’t think there are many people who want to be back in the office 5 days a week again – everyone has had a taste of balance and the majority prefer it. We work in an industry which can be intense when it comes to workload & after-work functions so being able to work from home one or two days is great. I’m all for it.
Most agencies have gravitated to at least 3 days a week in the office which seems to be working. I’ve heard of some media businesses trying to enforce 5 days back in but they’ve had push back from their staff on it.
I think the hardest part of hybrid working is training up juniors or people new to the industry remotely. There’s a lot to be said for seeing, hearing and asking questions on the fly when people are learning the ropes so it’s a fine line to get the perfect balance.
We’re seeing a slowing in hiring among agencies and redundancies across media platforms in contrast to the post lockdown frenzy to hire. Is talent available?
The market has definitely changed after that crazy period. Its cyclical though; we saw this 15 years ago or so too with a crazy hiring frenzy followed by a slow-down.
With the wind coming out of the sails in terms of media spend, and normality resuming post covid, budgets have tightened up again, not helped by the number of pitches going on.
There have been a number of redundancies across the industry unfortunately over the last few months or so, which means there are some great people now in market looking for their next opportunity.
AI is the big buzzword. Will it really have an impact on advertising?
It’s absolutely the buzzword right now & I’m sure we’ll hear it at most, if not all, of the up-fronts this season.
Now accessible to everyone and more affordable, Generative AI is already starting to have an impact on the industry, particularly around creativity (creating content based on text / voice commands using stock / determined images) and personalisation of content and audience experiences. I’d expect this to have a knock-on (positive) effect on advertising costs too as we continue to improve how we target consumers through more tailored messaging.
The challenges are already arising around creative licencing and intellectual property, trust and ownership and will no doubt require technical, legal and regulatory guardrails.
Every agency and holdco I’m sure will be working through how generative AI can fuel their planning and implementation tools so the industry is definitely going to evolve, and no doubt at a rapid pace.
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