After choosing not to release advertising revenue figures last year, the Advertising Standards Authority has changed its methodology and released reports for 2015 and 2016 to show digital, in all forms, is where the growth is.
According to the figures the overall advertising revenue across all main media in New Zealand was $2.572 billion in 2016, up from the 2.57 billion in 2015. The figures come from two Advertising Industry Turnover reports released today by the ASA today outlining where and how much advertising revenue is being generated.
Unsurprisingly, it’s digital that’s leading the way with a growth from $801 million to $891 million in 2016, which was 34.6 percent of New Zealand’s advertising revenue.
Making up those figures are ‘digital only’ and ‘digital other’ revenue streams, with the latter being a total of the revenue generated through television, newspaper, radio and magazines’ (only in 2016) online properties.
The revenue of those online properties has also been broken down according to media sector, which marks a change of thinking to the ASA’s revenue reporting.
As per previous years, the reports includes data from television, newspaper, interactive media, radio, magazines, outdoor, addressed main, unaddressed mail and cinema. However, this time, the television, newspaper, radio and magazine (only in 2016) categories have their interactive revenue shown in a digital category.
Last year, the ASA announced it would not be releasing the annual breakdown of actual revenue by media sector and a total advertising turnover number, with its reason being that the fragmented media world was making it hard to accurately report revenue in the correct sectors
The problem was most pronounced when examining digital spend because all major media companies now generate revenue from digital properties and that revenue was sometimes being counted in both the media and digital sector’s total.
It’s understood industry bodies could not reach a consensus on the reporting methodology when the ASA made the announcement last year.
However, those disagreements have now been resolved as industry bodies have agreed to the new reporting format.
It can now be seen that the television sector generated $559 million through television and $21 million through its online properties in 2016. It also shows that while television revenue dropped from $601 million in 2015, the sector’s revenue from its online properties grew from $20 million.
Between its two revenue streams, the television sector amounted to 22.6 percent of New Zealand’s advertising revenue in 2016 making it the second biggest sector, behind digital.
The newspaper sector’s digital revenue also grew from $41 million in 2015 to $61 million in 2016, while newspaper revenue dropped from $474 million in 2015 to $417 million in 2016.
News Works head of marketing Diane Hannay says it’s pleasing to see the digital elements of traditional media being broken out as there’s now consistency in the way the numbers are captured and greater transparency across the industry.
“The results for newspaper media reinforce what we’ve been seeing in the last 18 months – many advertisers value news media as a channel for its integrity, but the way they split their spend across print, digital and mobile news platforms is changing. The same is true for news media readers. Our research shows that it’s common for readers to jump between the print, digital and mobile versions of their favourite newspaper in a single day,” she says.
Meanwhile, the radio sector remained stable with its digital revenue at $4 million both years and a $1 million growth in radio revenue to be $271 million in 2016.
The magazine sector’s digital revenue was not measured in 2015 but in 2016, it was $22 million. This may contribute to magazine revenue’s drop from $210 million in 2015 to $199 million in 2016.
In both 2015 and 2016, addresses mail remained stable, growing from $58 million to $59 million, while unaddressed mail dropped from $52 million to $48 million.
Cinema also remained stable in both years, growing from $9 million to $10 million.
The change to report the television, newspaper, radio and magazine sectors’ dual revenue streams separately will no doubt relieve the frustration of media owners who previously saw revenue generated through their online properties allocated to the interactive sector when measured.
Last year, Bauer chief executive Paul Dykzeul pointed out that the inaccuracy allowed the interactive sector to trumpet its performance despite “at least some of that growth coming from spend generated in the traditional channels”. Now media owners can claim their own revenue.
Those who expressed disappointment in the ASA’s decision to not report the advertising revenue figures last year will also be pleased with today’s releasing of the reports.
Chair of OMANZ Wayne Chapman went so far as to call the decision “a little bit embarrassing for New Zealand” because it meant there was no whole market view to understand what the advertising turnover trend had been in the previous 12 calendar months.
ANZA chief executive Lindsay Mouat agreed, saying the data provides a guide in terms of how the industry is evolving.
But now, with the figures from the last two years released though the new methodology, any assessment of the industry and where it’s heading is more accurate than ever and the television, newspaper, radio and magazine sectors can remain confident that there is still growth for them.