Thursday, February 2, 2012

Starcom Media Futures Report, 2012

Modest growth is predicted for 2012, Media executives predict less than half the growth rate predicted by Advertisers


After a year of global economic uncertainty, advertisers and media executives have predicted lower growth levels than the past two years.

Findings from Starcom’s Media Futures survey indicate that the Australian advertising market is set for a modest level of growth. Among advertisers budgets are predicted to increase by 3.8%. 2011 demonstrated the current volatility of the advertising market, at the end of 2010 advertisers predicted a growth rate of 6.0% in the coming year, however with increasing global economic uncertainty experienced in 2011, advertisers downgraded their forecast for 2011 to 2.2% (a percentage point drop of 3.8). Media executives are less optimistic than advertisers, predicting a growth rate of 1.7%. In relation to their own channels, Display and Search executives are most buoyant, predicting growth rates of 22.5 and 12.6% respectively; Cinema and STV executives are also optimistic for their channels (8 and 7.3% respectively). For the first time in Media Futures’ history, we have included the consumer view on financial/spending trends. In comparison to last year, only 29% feel that their financial situation is better, while in comparison to next year consumers are more positive, with 41% predicting that their financial situation will improve. Consumers feel their disposable income is most pressured by household shopping and insurance products.


National advertising expenditure trends advertiser estimates v actual v CPI



Key trends for 2012 - Advertisers
  • Advertisers are more optimistic than media executives in their predictions of media expenditure/revenue in 2012 (Advertisers 3.8% vs. Media execs. 1.7%)
  • Comparing the 2011 annual prediction to the mid-year update for 2011 demonstrates the volatility of the advertising market, the predicted growth rate for 2011 (6.0%) shifted down substantially to 2.2%
  • In 2011 just over 9 in 10 of advertisers used Search, however FTA TV was used most often (67%)
  • Online is expected to grow most strongly overall, this year advertisers intend increase their spending on display more than search
  • Six in ten advertisers intend to use mobile advertising in 2012
  • Across BTL channels, close to 8 in 10 used PR in 2011, in 2012 this also the case, however the proportion of advertisers intending to use SMS in their campaigns has increased year on year
  • Increased management pressure is primarily expected to come from the areas of results/effectiveness, budgets and meeting business objectives

Estimated budget changes by major media


ATL media used – 2011 vs. expected for 2012

Key trends for 2012 – Media Executives

  • Metro FTA TV and magazine executives are the least optimistic about market growth rates
  • In relation to their own channels, Search and Display executives are most optimistic, predicting growth rates of 22.5 and 12.6% respectively, Cinema and STV executives are also optimistic for their channels (8 and 7.3% respectively)
  • In terms of revenue, media executives increasingly value clients who invest in integrated campaigns
  • Secondary TV channels are expected to increase in revenue by all TV executives surveyed, revenue from video on demand is expected to grow by 87% of TV executives
  • When asked about TV time slots, the biggest growth in revenue is expected for peak and sports/special events, predicted to grow by 12.8 and 10.6% respectively in 2012
  • In 2012, government and automotive are expected to be key growth industries
  • Compared to 2011 the proportion expecting revenue growth from finance and retail has dropped substantially

Expected market growth rate versus own channel growth rate

Media Executives
Total advertising market
(average %)
Own growth       (average %)
Internet - display
Internet - search
Television (Reg)
Subscription TV
Television (Metro)



Key trends for 2012 – Consumers
  • Among consumers, disposable income is pressured most by household shopping and insurance products
  • In comparison to the previous year, just 29% of consumers feel that their financial situation is better, 37% feel their position is the same
  • Consumers are more optimistic in relation to their finances for the coming year, with 41% believing their situation will have improved in one year’s time
  • Over one third believe carbon tax will decrease their disposable income
  • Value for money is extremely important in retail shopping, however only 31% of consumers would prioritise price over quality

Financial situation – comparisons to past and next year

Attitudes to Shopping

The Starcom Media Futures survey was launched in 1985 and is one of Australia’s most authoritative predictors of expected advertising budget growth over the coming year. It is the only survey of its kind, interviewing national advertisers and key media executives around the country. The survey is conducted by McNair Ingenuity on Starcom’s behalf via a telephone and online methodologies.  For the first time in Media Futures’ history consumer research was incorporated into this report, this was sourced from Starcom’s proprietary People Track study. If you have any queries, please do not hesitate to contact John Sintras or Susannah McInnes on (02) 8666 8000 

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