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Digital ad spend climbs to quarterly record of $159 million

The IAB NZ has released its latest ad spend figures and, as would be expected, the amount spent on digital advertising has continued to grow, reaching a record $159 million in the third quarter of 2014, up 22 percent from the amount posted at the same time last year.       

In a recent interview, the managing director of Google New Zealand Tony Keusgen told NZ Marketing that the Kiwi market was still lagging behind when viewed in the international context.     

“The New Zealand agency and advertiser landscape is behind its comparative markets,” said Keusgen. “So when you look at the adoption of digital for example, in New Zealand just 21 percent of total ad spend is on digital, whereas it’s 31 percent in Australia and 36 percent in the UK.  So, we know that New Zealand is really lagging behind in the adoption of digital to build brands and connect with consumers.”

Keusgen will no doubt be pleased to know that search and directories increased by 66 percent year on year, while video revenue also reflected significant growth of 42 percent

Speaking on the evolution of the industry, Keusgen also noted that Kiwi advertisers were starting to show an increased willingness to adopt a digital-driven approach.    

“We are seeing that tipping point in New Zealand now. We’ve seen a few examples where we’ve seem digital-led or digital-only campaigns … We’re seeing the adoption of digital platforms, like YouTube begin to happen, so we’re seeing that emerging sparkle of advertisers leaning into that.” 

The strongest indicator of shifting ad spend was evident in the mobile figures, which showed a 225 percent year-on-year increase, although this came off a much smaller base.  

According the ASA’s figures, total interactive ad spend in 2013 was $471 million, and Adrian Pickstock the IABNZ chief executive says the New Zealand digital market is on track to reach $500 million in 2014, which will see digital capturing 22 to 25 percent of total advertising spend.

The quarterly data released by the IAB NZ this year already shows the total interactive ad spend figure is currently sitting at $421 million (Q1 was at $120.2 million; Q2 was at $147.32 million; and now Q3 is at $159 million).

“It’s likely we’ll see digital ad spend surpass newspapers early next year and put immense pressure on television in the process,” said Pickstock.

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