Businesses paying more to advertise

By IRENE CHAPPLE

Increased economic confidence is leading to a boom in advertising spending.

Advertising revenue in all media is expected to be up on last year's depressed total of $1.6 billion.

Television has increased its advertising revenue 6.6 per cent for the third quarter, compared with the same time last year.

That follows a 7.1 per cent increase in ad revenue for the second quarter.

The increased revenue follows a rise in ratecard costs that shows advertisers are prepared to pay more for the best slots, says New Zealand Television Broadcasting Council executive director Bruce Wallace.

Spending on television advertising was likely to exceed $500 million this year, up from $479 million last year.

Television's attraction has been boosted by high-profile sports events such as the Commonwealth Games and the Warriors' rugby league games.

Sport also lifted television advertising revenue in Australia.

The Ten Network credits the Aussie Rules finals with revenue increases of 30 per cent through September, after a 16 per cent increase for the first half of the year.

New Zealand newspapers are also enjoying increased revenue, especially in country areas.

Newspaper Advertising Bureau executive director Maurice Mehlhopt says revenue is up by about 15 per cent in regional newspapers, and around 7 to 8 per cent in metropolitans.

Pip Elliott, the New Zealand Herald general manager of sales and marketing, says newspaper advertising has been lifted by increases in real estate, retail and automotive advertising.

She said the trends came in response to the dotcom bust, the aftermath of last year's September 11 attacks and Air New Zealand's financial troubles.

These events made people reassess their lives and put money into "bricks and mortar".

Mehlhopt estimated the industry would have an increase of around 10 per cent by the end of the year.

This would lift last year's spending of $606 million to almost $670 million.

Magazines have had a 5 to 7 per cent increase on last year, says Magazine Publishers Association executive director John McClintock.

He said the industry would be delighted if it added 6 per cent to last year's $166 million total.

Radio, last year's big winner, has settled down and is 3.7 per cent up on the same time year.

The Radio Bureau's Gill Stewart said radio revenue would top $200 million for the first time if growth continued.

Communication Agencies Association of New Zealand head Lynne Clifton said a full picture was not yet available.

"But anecdotally, everyone is having a pretty good run. There seems to be a lot of positivity."