Australia’s advertising market grew by +8% this year to reach AUD 22.3 billion ($16.8 billion) and an additional +5% in 2023 to AUD 23.5 billion ($17.7 billion) according to MAGNA’s Global Advertising Forecast for December 2022, released today. This reflects the economic growth environment. GDP will continue its growth by +3.8% this year on a real basis, following a very strong economic rebound in 2021 of +4.9%. Mobility has returned to normal levels as inflation increases by +6.5% in 2022 and by +4.8% in 2023.
Digital advertising spending grew by +9% this year to reach AUD 16.2 billion ($12.1 billion). This represents 72% of total ad spending. This is only behind the China, Canada, Norway, Taiwan, Sweden, and the United Kingdom, for highest share of digital advertising budgets as a percent of total ad spending. Growth is led by mobile advertising spending, which will increase by +12% to AUD 11.2 billion ($8.4 billion). By format, search (+12%), video (+12%), and social media (+7%) are leading the way.
Linear advertising formats grew by +3% this year to reach AUD 6.2 billion (4.6 billion). This follows 2021’s +14% growth for linear advertising sales and represents 95% of the pre-COVID linear ad spending total. However, given that television is expected to continue eroding, and print continues its long decline, linear ad spend will never reach the pre-COVID highs in Australia. Linear Television set to shrink by 2% in 2022, despite a relatively strong H1 buoyed by the Federal Election and political party spend, and the return of Travel and Entertainment categories fuelling demand post the 2021 lockdowns. H2 expenditure dragging, with the additional note on YOY comparisons with 2021 Olympics, and the 2021 Q3 lockdowns in key markets skewing spend to TV. Erosion is expected to continue in 2023, forecast down -7%, as viewing continues to shift from linear television to digital formats.
Other linear formats expanded this year (radio +10% to AUD 687 million, out of home +23% to AUD 1.1 billion), but print will continue its decline (-3% to AUD 423 million).
Looking forward to 2023, Australia’s advertising economy will grow by +5% to reach AUD 23.5 billion ($17.7 billion), with digital advertising again leading the way (+9%). While this is not as strong as this year in 2022, it represents 2/3 as much incremental digital ad spending. The growth comparison is just more difficult as it is up against the tremendous performance from 2021 and this year rather than the extremely weak performance of 2020.
Says Lucy Formosa-Morgan (pictured above), CEO MAGNA Australia: “2022 was a strong year for ad growth in Australia as a whole. With so many global and local pressures (Russia’s invasion of Ukraine, China’s COVID zero tolerance stance impacting manufacturing, inflation, seven interest rate rises, etc.) impacting consumers, we do envisage that consumer spending will start to reduce in the new year and as such we are forecasting that total ad spend for 2023 will be low single digit growth with only a handful of channels showing growth.”