SMI reports on strongest 2016 ad categories

Agency market delivers fifth record year despite softer December results

Australia’s media agency market has demonstrated its strength by recording its fifth consecutive year of growth in the 2016 calendar year with total payments lifting 1.1% from 2015 to $7.11 billion, according to SMI.

The higher bookings ensured four of the seven main media scored a record level of bookings in 2016 with the growth led by digital (+14.2% on CY2015), outdoor (+7.9%), radio (+5.6%) and then cinema (+0.5%).

SMI’s category data shows government spending did the most to buoy the market in CY2016 (+$80.9 million) due to federal election and census-related advertising, but from a percentage perspective the healthcare category reported the highest growth (+67.9%).

SMI AU/NZ managing director Jane Schulze said the figures prove the ongoing buoyancy of the Australian media agency market, which in turn has been aided by continued innovation within the media level.

“Australia’s media remains one of the most innovative in the world, with our media companies continuing to find new and improved ways for advertisers and their agencies to reach audiences,’’ she said.

“As a result we’ve seen key product categories such as automotive brands, retail, food/produce/dairy and travel all increase their marketing budgets in the past year and most of those have also grown their advertising spend in December.’’

Despite this, the early December results are showing a year-on-year decline of 6.6% for the month to $457.7 million before late digital bookings are received. And the level of decline is expected to reduce more than usual at that time given the holiday period.

As a result, the digital media is currently reporting a year-on-year decline of 15.1%, with the growth mantle instead shifting to the metropolitan radio market which grew agency spending by 20.8%.

And apart from higher bookings from the retail and automotive brand categories, the strongest growth among the major categories in December came from the movies/cinema/theme parks sector which lifted spending 13.9% to become the market’s fifth largest category in the month.

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