SMI provides visability of ad spend for product categories

  • Advertising
  • August 27, 2018
  • StopPress Team
SMI provides visability of ad spend for product categories

Standard Media Index (SMI) has released data on ad spend for 96 product categories across all major media, enabling accurate media mix modelling and advertiser category benchmarking.

The data shows media weights and percentage changes in spend for the June 2018 period compared with June 2017. 2017 was a record year for agency advertising spend, with data released SMI showing $1.048 billion was spent on major media across the year in New Zealand. 

Looking at the data provided by SMI, of which it picked 10 of the New Zealand product categories at random, there were big variations in category spend.

Supermarkets/liquor/convenience stores, for example, were up 36 percent on overall spend – with magazines up 84.7 percent and outdoor up 73.9 percent. Looking at specific brands, Nielsen reported that for 2016 and 2017 supermarkets, Foodstuffs NZ Ltd and Progressive Enterprises Ltd (now Woolworths New Zealand) were both in the top five for ad spend with Foodstuffs NZ Ltd increasing its spend from $75.7 million in 2016 to $76.47 million in 2018 while Woolworths New Zealand decreased its spend from $58.34 million to $57.3 million.

And while supermarkets/liquor/convenience stores' ad spend was on the rise, SMI's data shows mobile networks ad spend was reduced by 40.7 percent overall year-on-year, with noted examples of digital down 59.9 percent and television down 33 percent. Interestingly 32 percent each of the media allocation went to outdoor and digital.

With Spark winning the rights alongside TVNZ meaning New Zealanders will be able to stream Rugby World Cup 2019 matches and related content live or on-demand over their home broadband or mobile connection – it will be interesting to see if that has an impact on the data for 2019.

Also reducing its media allocation to TV was the beer/ale/cider category, which dropped it down 20.9 percent between June 2017 and June 2018.

For confectionary/snacks/dessert items category the ad spend was down two percent, and 44 percent of the media share went to television – up 28.5 percent.

Interestingly, airlines grew their TV spend in June by 14.8 percent while at the same time travel agents/websites reduced TV bookings by almost 20 percent. And while airlines spent 10.2 percent of their media budgets on outdoor, travel agents/websites spent only 1.4 percent of all spend on outdoor.

SMI AU/NZ managing director Jane Ractliffe says the service highlights the large differences in media weightings and demand across all product categories with even similar categories revealing markedly different media plans.

Ractliffe says SMI is all about creating more market transparency and “filling the ad spend data gaps regularly complained about by major media and advertisers and this development is a perfect example of that,’’ she says.

"This data provides the clarify the market needs to work more efficiently by better understanding the immense differences in media spending across all product categories, both in terms of media weighting and year-on-year percentage increases/decreases in ad spend by media.

"There is simply no uniformity in how categories allocate their media budgets across media nor in terms of their decisions on whether to grow or reduce ad spend. It clearly highlights the difficulties all media companies face when trying to navigate the advertiser market."

She says the data provides valuable market transparency to media sales teams who have previously been blind to the trends within the key categories they are seeking to engage, and gives advertisers the ability to accurately benchmark their media spend against that of their competitor market.

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