SMI: Cinema suffers and Seven rules TV

Pippa Chambers
By Pippa Chambers | 18 November 2014

Australia’s paid media advertising market dropped 3.2% in October, compared to the same time last year.

The fall in total ad spend was revealed in fresh figures from the Standard Media Index (SMI), which measures ad bookings made through media agencies.

While this is a drop across the paid media landscape, UM CEO Mat Baxter said it's important to remember that paid media is just one subset of marketing.

Baxter said he expects to see further reductions in paid media year-on year, as more clients take ad dollars from traditional marketing methods and instead, spend this on other non-paid marketing areas such as apps, content creation, tech platforms and website enhancements.

Just because SMI figures may show a drop, this does not mean that marketing spend is down,” Baxter said.

On the contrary, we are seeing that marketing spend is up, it's just that clients are investing in other marketing areas, other than paid media. Paid media will represent a smaller and smaller share of incremental ad spend in the future.

Marketing is in a new golden age. We are in a better place than we were last year and speaking from our standpoint, we have seen more investments from clients and marketing is becoming more and more centric to advertisers.”

Baxter said it was also key to remember that some companies are also now using their own ad exchanges in-house.

Cinema took the biggest fall suffering a decrease of 46.4%, compared to September 2013.

Looking at agency bookings for TV for the month of October, figures show a 4.7% drop in metro TV advertising, a 6% slump in subscription TV and a 5% drop in regional TV.

Seven ruled the metro TV ad market with 40.8% share of the pie, Nine owned a 38.1% share and Ten's share was 21.1%.

Revenue-wise all three networks were down. Seven saw a 5.4% decrease, Ten saw a 7.4% fall and Nine's revenue declined by 2.6%.

Even though Seven took the top spot, it told investors at its recent AGM that it was indeed suffering on the back of an 'unexpected' drop in ad revenue.

Ad spend was down 11.8% across magazines. Trade magazines saw a decline of 7% and consumer magazine ad spend was down 12.1%.

Despite this, Seven West Media-owned Pacific Magazines managed to edge closer to rival Bauer Media. It took a 37.4% share of magazine ad revenues, chasing at the heels of Bauer which had a 37.8% share.

It wasn't all doom and gloom as radio's share of ad spend was up 9.2% and outdoor spend was up 7.1%.

In digital, in which SMI includes content sites, search vendors, exchanges, ad networks, social networks, video vendors and mobile vendors, saw a 2.4% increase in October. The figures are interim numbers and will be updated later in the month.

Despite the overall digital increase, there was a fall of 20.9% in the 'ad networks/affiliates/EDM' digital category, a 10.9% decrease in 'search vendors' and a 1.4% drop in 'content sites'.

For more news:

Seven West forecasts decline in ad market

SMI: Ad market grows 3.6% on 2013

Twitter TV ratings now live: Sports and reality dominate

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