A cautious optimism has begun to inch through Australia's advertising sector, with new research pointing to an easing in the Australian bleed or, at least, a fresh state of equilibrium.
According to a survey by Zenith Optimedia, media spending across Asia-Pacific is set to lift 1.7 per cent this year. Furthermore, the Advertising Expenditure Forecasts poll predicts a four per cent rise for 2003. As a whole, the survey found advertising spend was expected to grow by as much as 8.1 per cent throughout Asia-Pacific.
The results are a stretch from the global outlook which - Zenith claims - remains bleak. Figures point to a 0.5 percentage point fall in global adspend this year to US$302 billion.
Nonetheless, while some advertising executives agree Australia's advertising plight is turning, most maintain the turbulence is not yet over. Steve Allen, director of media buying shop Fusion Strategy, tentatively predicts total Australian adspend will grow by 3.3 per cent in the second half of 2002. This would take the nation's annual spend to A$7.3 billion. However, Allen notes this would still leave the industry nearly three per cent down on the previous year when total adspend reached almost A$7.6 billion.
He says the likelihood of Australia realising this scenario rests on America. "The US is on the precipice of a double-dip recession; the stock market's (performance) could trigger a dive in consumer spending. If that happens all the exporting nations are stuffed. It's the US consumer sector that's kept us out of jail."
The American impact aside, various media sectors are starting to show renewed growth. "Radio is still quite healthy; television's definitely seen an upswing, Allen says.
Indeed, the three major metropolitan television networks Seven, Nine and Ten posted a revenue growth of around three per cent in May and June and have reportedly forecast single-digit revenue growth for the second half of 2002.
The figures have urged some, such as media buying heavyweight Harold Mitchell, to predict a growth of about four per cent in media spend by December. But others, including Zenith Australia chief executive officer Anne Parsons believe otherwise.
"We are an airline less and there's a telecommunications company that's come out of the market. (Telecommunications leader) Telstra has since confirmed that its spend might be down by a third. There's no reason for it to be turning up, says Parsons.
Parsons claims anyone predicting a turnaround is ignoring historical trends, which she says show current advertising spend is actually at reasonable levels.
Matt McGrath, creative director of George Patterson Bates, agrees. He says anyone who thinks otherwise will be disappointed. "We've had the Olympics and we've had the dotcom boom and I think it's readjusted back to a natural level now in Australia. I think we've got to get used to a situation of working with these budgets."
Others, such as Mark Pearce, managing director of Clemenger BBDO's Melbourne office, says this perspective leaves no room for growth. "I don't agree with that because that's suggesting that the market would be static, and it's not."
Likewise, Allen notes that the advertising recession is not coupled with an economic recession in Australia and he says this is proving a catalyst for many small brands to start spending big.
"Anyone that's getting in there now and spending, they're pinching market share and catching the global players asleep."
