Pearman Pulse

TELEVISION – TRENDS & TRAVAILS

After half a decade of waxing and waning in popularity, Television is witnessing a remarkable resurgence with both marketers and advertising revenue. Television’s advertising revenue is up 10.6% in FY21 (vs FY20) while the total ad spend is only up 7.1%.  In other words TV is outstripping the total market by 49%.

On the client side, Television is benefiting from relatively new categories such as ‘Food Delivery Services’ (Doordash, Menulog, etc) and Financial clients such as WISR, Superhero & Bell Direct. The Retail category is invariably the largest category and clients like Woolworths, Harvey Norman and Bing Lee are certainly showing their faith in Television.

It was not long ago that the advertising industry and trade media were writing off Television as yesterday’s media however we presently have three strong TV Networks.  Nine is now part of a hugely diversified media company, Seven has its debt under control and Ten is backed by ViacomCBS. This is evident by the Nine and Seven share price movements. If you were smart enough to buy Nine /  NEC shares a year ago your money would have grown 104% ($1.35 to $2.76) and in Seven / SWM it would have grown 380% ($0.10 to $0.48).

On the audience front the Networks have been losing audience on their main channels but gaining audience on the digital stations. Like all media, the traditional Television audience has fragmented greatly (due to SVOD, BVOD etc) although in 2020 the average main channel Peak Night audience actually increased slightly, the first increase in nearly a decade. Unfortunately 2021 commenced with a major spanner in the works with the delay of the Australian Open Tennis by two weeks. This caused havoc with both Nine and Seven’s quarter one launch formats resulting in a loss of audience and also complete disruption to programming and momentum. The Australian Open has traditionally been used by Seven and Nine (since 2019) as a way to launch their first quarter programs and particularly their major new programs. The Australian Open’s audience was down double digits this year and consequently it did not provide as strong a platform to launch the year for Nine. Early in the year, the main commercial channel audience was down around 20% but recovered in recent weeks to be down circa 8%.

Programming has been a year of modest hits and quite a few misses. No Network has been immune although Seven’s Holey Moley and Ultimate Tag certainly didn’t help them. This unevenness and difficulty to predict the viewing market has further exacerbated audience deliveries. Judging recent weeks, where all three Major Commercial Networks are programming better and more competitively the ratings malaise of the first half year may be behind us.

Despite the ratings being down there has been a renewed demand for airtime meaning we need to allow far more time (12+ weeks) to ensure we’re able to buy an optimised TV campaign. Something Advertisers and Buyers have not had to contend with for 5 years. The overall YTD trend has played havoc with campaign audience delivery and whist pretty much all Networks are using an audience projected negotiation rate card, these have proven to be optimistic. Worse, the uneven spread of popular rating programs has concentrated buyers to grab the cost efficient programs at a considerably faster rate than in the recent years.

Fortunately for the ratings, we are presently in the middle of the world’s biggest sporting event and for Australia it is in the same time zone. With roughly half of Australia at home in lockdown and the Aussies winning lots of medals, this is proving to be a huge boost to Seven’s ratings. The halo effect of airing the Olympics is increasing other Seven programs (e.g. News, Sunrise) by 30-40%. Conversely, it is decreasing the other stations ratings by around 10-20%.  Overall more people are now watching TV due to the Olympics and there has been a massive boost to the 7Plus (BVOD) app.

Television has not been in such a good financial position for many many years with increasing ad revenue, high demand for airtime and increasing share prices.

WHAT’S NEW IN MEDIA – LOCKDOWN SILVERLINING

Although it is hard to find too many positives from the COVID-19 pandemic, we can say that the digital components of Television and Newspapers have been given an opportunity to flourish. Both have seen a strong rise in consumers and advertising revenue which no doubt has been accelerated due to the lockdowns.

For Television, Broadcast Video on Demand or BVOD’s advertising revenue  grew 39% in 2020 and continues to grow enormously with big sporting events in 2021. Channel 9’s coverage of the recent State of Origin saw 228,000 additional viewers opting to stream the 2nd game on 9Now, up 48% on 2020 and 162% on 2019. While on Seven, the Tokyo Olympics has ensured the 7Plus app has been downloaded over 8 million times. In addition to Sport, the need for News during a pandemic is another reason the apps are growing. The other good news for the Television Networks is the apps attract a younger audience that has been difficult to retain on the main channels. All this has seen the advertising revenue on BVOD growing at 50%+ per year.

For Newspapers, their digital news subscriptions grew by 23.5% in 2020 and are going from strength to strength. Last week the Olympics delivered News Corp a 35%+ increase in website traffic. In the latest April-June quarter advertising revenue for the Digital newspapers grew 44% while the printed paper revenue declined 6%. Australia lags behind the global average of digital news subscriptions which hints that the current lockdown may lead to even more growth in the sector.

The road to recovery in a post COVID Australia may be a long one but for Television and Newspapers the recovery has already begun through their digital platforms.

DIGITAL – EASILY INFLUENCED?

With around 80% of Australians having an active social media account, it’s created a gold mine for Influencers to reach a wide range of consumers.

The global influencer market has apparently grown from $2.3 billion AUD in 2016 to a projected $18.8 billion in 2021.

This growth in the influencer market has seen the establishment of platforms such as Tribe and Vamp which provide structure, measurability, and accountability for potential campaigns. Ideally, using agencies like the above give clients the confidence that influencers have been pre-vetted and are suitable for specific campaigns.

With influencers emerging as a profitable career the question often asked is “How much money do they actually make?”. The influencer landscape is split into five main categories.

Category Followers  
Mega-Influencer 1 million+ Hugh Jackman (30 million)
Chris Hemsworth (50 million)
Macro-Influencer 500k – 1 million  
Mid-tier Influencer 50k-500k  
Micro-Influencer 10k-50k  
Nono-Influencer 1k-10k  

Micro-influencers are the most common in Australia making up 46% of the influencer landscape.

Micro-influencers make anywhere from $15-$150 per post. While Mega influencers can make from $700-$15,000 per post. If you’re one of the lucky influencers, such as Australian Tammy Hembrow who has amassed 12.7 million followers, you can earn up to $85,000 per post.

So what are you waiting for, with Influencer marketing as an emerging form of advertising perhaps you should stop reading this and concentrate on boosting your social followers.

SMI UPDATE – JUNE 2021

Advertising spend in June was the largest month of ad spend ever recorded in a Jan-Jun period in SMI history – $754 million in June.  This is a 44.3% increase on June20 and $643,000 more than June19.  FY21 is +7.1% above FY20 although this includes the heavily affected months of Apr, May & Jun’20. When comparing the 12 months of FY21 to FY19, the advertising spend is down -7%.  The latest six months spend of Jan-Jun’21 looks more positive when compared to Jan-Jun’19 as it is only -2.57% down. The Jan-Jun19 included spend for a Federal Election but also had a couple of rocky months. Overall, ad spend is looking good with SMI saying the forward July & August bookings are looking strong albeit partly buoyed by the Olympics.

The two largest categories of Retail and Auto influence the spend quite a bit. In June21 both these categories were up 33% and 48% respectively. Looking at the FY21 vs FY20, Retail is up 12.7% but Auto is lagging somewhat at -8.8%.  Auto is still around 30% down on what it spent in FY19. Travel has certainly been coming back in a big way with a 157% increase for Jun21 vs Jun20 and quarter vs quarter it was up 272.9%. Government is a category that has continued to spend and is up 12.6% comparing FY21 to FY19.

Outdoor continued to recover in June and was 146.9% up on Jun20 but still

-10% down on Jun19. Television did very well and increased 39.9% on Jun20 and was only -2.2% on Jun19. Radio was up 38.2, Digital (+37.9%), Magazines (+27.5%) and Newspapers (+0.8%). Cinema increased a whopping 367.9% in Jun21 although it is off a very low base in Jun20.

FAST FACTS

  1. Hidilyn Diaz won the Philippines first gold medal in women’s weightlifting. She also won $899,00 AUD and a mansion from the government & businessmen.
  2. Australia’s ABS unemployment rate fell to 4.9% in June21 – lowest in 10yrs
  3. 3% of Australian mortgage holders were at risk of ‘mortgage stress’ in mid 2021 – this is a near record low ! (Morgan)
  4. Motorboat sailing, hot air ballooning, and tug of war all used to be Olympic sports
  5. Until 1912, first-place Olympic medals were made of solid gold. Now they are covered in 6 grams of gold.