TONY’S LAST WORD
WITH THE ECONOMY booming, and the World Cup looming, expenditure on advertising, sponsorship and other forms of marketing communication looks set to continue growing for the next three years. The portents are obviously as good for the media, direct beneficiaries of increased adspend.
But all good things, especially economic, must come to an end. Immediately after the World Cup seems a likely time frame. Indicators of future difficulty are already evident – even as the media enjoy unprecedented growth.
The most obvious indicator has been the explosion of new titles – 123 of them registered with the ABC last year, which amounts to an increase in its member titles of 23%. Most of them were magazines.
Clearly, this means the advertising cake is being cut into thinner slices, and equally clearly, existing titles have to take some pain. Strong adspend growth masks the overtrading issue, but watch for a clean-out of weaker titles when times get tough.
However, all predictions are subject to a health warning. My last prediction regarding the outlook for advertising was that the Government’s attempts to slow down the apparently overheated consumerspending spree, would result in slower adspend growth this year. Several increases in interest rates appear to have had little effect – so far. I may yet turn out to have been right. Timing is everything.