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OOH in the Month of May Suffers Ad Spend Decline of 71.1%

Australian Ad Market

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May OOH Suffers Ad Spend Decline of 71.1%

This news will not make you feel good but it might make you feel better.

Don’t write this post off as ‘we don’t care what the hell is going on in Australia’.  We should consider all experiences as it might compare and provide forecasts for the States.

Consider Australia’s transparency in reporting and how it aligns with America.

For the month of May, in Australia out-of-home (OOH) and cinema suffered large declines, seeing ad spend plummet by 71.1% and 79% respectively as the population stayed at home.  This is in the Australian ad market where the decline was a record 40.4% in May for the combined advertising market. 

Is American OOH in the same boat?  Suggestions are there may be problems with cash collection from large agencies. It will hit national players hardest, but will not happen till after 3Q/4Q when we may see these delays in cash collections for the OOH operators. Second quarter might actually be cash positive, despite no new billings, because that cash is coming in from previous Quarters. Might work for Wall Street. Again it is short term thinking in the effort to defend the value of the stock.

We would love to hear more discussions on national agencies delaying cash deferrals to operators. Any one want to step up and address?

Will the Big 3 or publicly held operators spin a narrative with a dual messages of maintaining rates while attempting to keep a stronger cash collection?  That strategy would certainly mix recovery trends with lagging trends.

The guidance may creative reporting, but keeps stock prices pumped.  We will see. 

In the meantime, read what our cousins in another country, Australia, are reporting.
Read the brief post below about the unfortunate 71% down in OOH. 

Is their’s transparency to a fault? 

Click the link from ExchangeWire News Digest or read the brief word for word post below from Exchange Wire below.

 

a message from Wrapify

 

Out-of-home (OOH) and cinema suffers monster declines with ad spend plummet by 71.1% and 79% respectively as the population stayed at home.

Australian ad spend tumbled 40% in May

 

Standard Media Index Australia-New Zealand (SMI AUNZ) has found that Australia’s ad market declined by a record 40.4% in May. The figures, derived from an analysis of the country’s media-agency funded advertising landscape, discovered that ad spend fell by AUD $234m (£135m). Combined with the recorded and estimated declines of April and June, the market is expected to see a total loss of AUD $700m (£389m) over the quarter.

 

Double-digit losses were recorded across all channels as brands hurried to protect their budgets against the onslaught of COVID-19. As expected, out-of-home (OOH) and cinema suffered particularly large declines, seeing ad spend plummet by 71.1% and 79% respectively as the population stayed at home.

As expected, out-of-home (OOH) and cinema suffered particularly large declines, seeing ad spend plummet by 71.1% and 79% respectively as the population stayed at home.

Magazines, radio, and newspapers also experienced a fall in ad spend, with newspapers seeing spend cut by close to 50% despite record levels of readership. Unsurprisingly, however, travel suffered the greatest knock during May, seeing ad spend fall by a staggering 92%.

The results bring the market’s total 2020 decline to 21.3%. According to SMI AUNZ managing director, Jane Ratcliffe, the figures are reflective of a global trend, with Canada, the UK, and New Zealand all reporting significant declines over the last month.

 

 

 

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2 Comments
  1. Kara says

    This is great information and often times, global reports are more accurate then what we see in the United States. US reports showing minimal impact, make me wonder how much smoke and mirrors really takes place in US companies and markets reports.

  2. No Fear No Favor says

    Smoke and mirrors, while we might choose at this time, not to say it, we respect your right to say it. Thank you Kara. How much time can OOH buy in their reporting before time runs out? The hockey stick recovery does not appear to happening. What is plan’B’?