January total ad spend down 10% from 2022, Government category down 48%: SMI

The latest Standard Media Index (SMI) figures show ad spend in January is down 10% year-on-year (YoY) to $542.6 million, against an extraordinarily strong market last year.

2023 still saw the second-highest January ad spend in SMI history, followinglast year’s soaring records thanks to COVID-related content.

The Government category most notably fell back 48% YoY, with SMI AU/NZ managing director Jane Ractliffe attributing the decrease to changing trends post-COVID.

“The unusually high level of Government category ad spend that SMI has been reporting across the past two years had to return to a more normal level once the COVID threat eased, and that’s now happening,” she said.

“The SMI data shows how much the Government category has buoyed the market with the category’s decline of $25 million representing almost half the total market decline this month. And when we remove Government spend from the data, we see Outdoor ad spend grew by 5.1%, Radio bookings rose by 2.4% and Cinema’s growth jumped to 66%.”

Ractliffe said the Government decline buried increases in other categories, as Retail, Insurance and Travel ad spend all saw strong gains. Retail rose 8.7% YoY, while Insurance advertising lifted 12% – making it the second largest for the month – and Travel had a 64% increase.

Digital spend fell for the second consecutive month, and the Programmatic and Social Media categories also declined. TV also dropped, due to the huge prior year period.

In the current financial year, ad demand is up 1.9% to $5.2 billion as there has been huge growth in Automotive Brand and Travel ad spend. This has pushed the ad market over $500 million larger than it was in the 2019/20 pre-COVID periods.

Outdoor and Cinema have reported strong gains in the same period, with increases of 29% and 57% respectively, as they continue their COVID rebound.

Magazine spend has seen a 9.3% increase this financial year to date, with related Digital revenues included. Radio/Audio ad spend is also stable on this basis.

“We’ve seen the value of the Australian ad market move beyond $9 billion for the first time in the last calendar year, and with the current momentum and with what we’re seeing in SMI’s forward pacings data it looks certain that we’ll further exceed that level in the current financial year,” Ractliffe said.