AUCKLAND, Today: New Zealand’s media industry has felt the full consequences of the Covid-19 pandemic’s impact on the economy in April, with reduced business confidence driving a 37.9% decline in adspend to $50.1 million.
The decline ends three months of consecutive growth in the NZ market, but was somewhat softened by a very large increase in Government category bookings with Government adspend up 123.5% to $11.4 million as they promoted the Covid-safe message.
But NZ’s market figures are in line with that seen in other SMI markets – the Australian media reporting a 35.4% fall in April bookings from agencies while in the US the decline was 35.3%.
There was some positive news with NZ newspapers emerging as the only media in not only NZ but also the US and Australia to deliver growth in April (+4.3%), mostly due to strong increases in Government and Banking adspend.
Apart from the Government market, only three other product categories reported any growth this month with Covid instead having a hammering effect on key categories such as Tourism/Accommodation Services (-96.8% fall in YOY adspend), Airlines/Travel Agents (-95.8%), Entertainment (-98%) and Restaurants (-75%).
“SMI’s Forward Pacings data is looking more positive in June.”
SMI AU/NZ MD Jane Ractliffe (Sydney-based) said the level of decline is beyond that seen in 2009 during the global financial crisis.
“New Zealand’s advertising economy suffered the full force of the Covid impact in April as it was the first full month in which the economy was in partial lockdown,” she said.
“Clearly this decline is far larger and was also more sudden than the GFC which evolved over a few months. In contrast, the Covid lockdowns occurred within weeks of the virus’ potential danger being realised, so it’s had a more devastating impact on media which had no time to prepare for such an extreme loss of revenue.”
But Ractliffe said SMI’s Forward Pacings data was looking more positive in June, with 35.1% of the value of last June’s adspend already guaranteed which is a 3.7% improvement on the level of future demand evident at the same time last month.
“And we can already see in June that product categories such as cleaning products, credit cards and pet food have already guaranteed to spend more on advertising in June 2020 than they did in June 2019 so there’s clearly some green shoots already in the market,” she said.
The sharp contraction in April demand has now pushed the market back 8.6% for the January – April period and by 1.1% in the financial year-to-date.
The Trends
- Television -32.7%
- Outdoor -39.1%
- Digital -39.1%
- Radio -25.8%
- Newspapers 4.3%
- Magazines -49.2%
- Cinema -74.0% Grand Total -37.0%
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