New Zealand companies spend $2.56 billion on placing adverts

Advertisers continue to increase their spend on digital advertising. Photo/123RF.

Data from the Advertising Standards Authority (ASA) shows that New Zealand businesses spent $2.56 billion on media placement for advertising in 2017.

This figure is down slightly from the $2.57b spent in 2016 and 2015, but up on the $2.39b spent in 2014.

The biggest portion of this was spent on digital campaigns, which accounted for $925 million, up from $891m in 2016. Digital media spend has ballooned in recent years, with the channel growing its share of the pie by more than $100m since 2015.

As suggested by the relative consistency of the overall spend figures, this isn't new money and it has come at the expense of the traditional media channels. That said, $138m of the overall digital figure has been contributed through the digital arms of magazine, newspaper, radio and television media companies.

The second biggest overall media channel was television, which posted a total figure of $591m. Interestingly, this was up on the 2016 spend of $580m, which is perhaps indicative of the impact of research from academics showing the continued importance of television to the media mix.

Over the course of the last two years, TV broadcasters have pushed this message hard by inviting academic researchers such as Peter Field and Mark Ritson to New Zealand to present their views on why traditional media should not simply be jettisoned for digital.

Further back was the newspaper category at $435m, which was down more than $40m from the $478m posted in 2016. Despite the drop, the newspaper category will, however, see a positive in its digital advertising component, which rose from $61m in 2016 to $82m in 2017.

The magazine category followed the downward print trend, posting a figure of $209m, slipping over $10m from 2016's $221m.

A traditional category that will not be complaining about digital disruption is the outdoor channel, which has grew from $118m in 2016 to post a figure of $140m in 2017. The outdoor industry has benefited from digitisation in recent years in that it has allowed for more advertising slots to be added to a single billboard site as well as opening the door to greater innovation.

Another strong performer among the traditional channels is the radio category, which earned $283m in media spend in 2017, up from $275m in 2016 and $274m in 2015.

Addressed mail dropped from $59m to $54m while unaddressed mailers rose from $48m to $53m between 2016 and 2017.

And it appears that advertisers still have an appetite for the big screen with the cinema category rising from $9m in 2016 to $11m last year.