Australia’s media agency ad market for the financial year 2018-19 was worth $6.93bn, but this was a drop of 1.4% compared with the record-breaking spend of 2017-18.

Last year, the advertising market benefitted from spending on the Commonwealth Games, the financial services Royal Commission and various by-elections and state elections.

But according to Standard Media Index (SMI), the market has suffered this year from a lack of business confidence, global political uncertainty and a tighter credit market post-Royal Commission.

As reported by AdNews, SMI found revenue to be flat in the first half of the financial year, but then it fell 2.9% in the second half to drag down the full-year results for the first time since 2012-13.

Spend allocated to television (-4.7%), newspapers (-8.8%), magazines (-16.6%) and cinema (-15.6%) all fell compared to financial year 2017-18, although there was a brighter outlook elsewhere because record levels of adspend went to digital (+2.7%), radio (+1.7%) and outdoor media (+4.5%).

In addition, ten product categories saw record spending, led by the political parties/union category, which doubled adspend to $101.4m thanks to this year’s federal election.

It was also encouraging that retail’s media investment moved above $700m for the first time, while the travel category grew to more than $400m.

SMI’s data for June 2019 also provided some relief because, even though agency market spend was down -1.5% compared with June 2018, it was the lowest reported fall since November last year, excluding the impact of election spending in May.

Outdoor delivered the best performance in June (+7.3%), although metropolitan TV bookings were up 1.8% once SBS’ results were excluded to compensate for last year’s broadcast of the FIFA football World Cup.

Commenting on the findings, Jane Ratcliffe, SMI AU/NZ managing director, said: “As SMI’s data history has shown, it’s very unusual for the agency market to not grow and it’s taken an unprecedented number of negative events to deliver this knock.

“But we’re seeing numerous local and global issues come into play at the same time which have had the combined effect of significantly reducing business confidence and therefore adspend.”

Sourced from SMI, AdNews; additional content by WARC staff