The PwC Entertainment and Media Outlook 2013-2017 has predicted the overall ad market to lift at an compound annual growth rate (CAGR) of 2.7% to $13.18 billion.
Pay TV and digital will track the highest growth as online advertising is set to overtake free-to-air TV as the highest revenue-generating sector. Newspapers and consumer magazines will continue their downwards trajectory.
(click on each sector headline to read full details from Adnews)
– Online ad market will grow to $4.85 billion at a CAGR of 9.4%.
– Online has overtaken TV to be the largest segment in 2013.
– Mobile advertising will grow at a CAGR of 25.7% by 2017 to $244 million.
– Online video advertising will grow at a CAGR of 44.1% by 2017 to $559 million.
– Free-to-air TV will remain formidable with a CAGR of 1.7% by 2017 to $3.57 billion.
– Pay TV will grow at a CAGR of 9.6%, which outpaces digital, to $645 million by 2017.
– Digital and issues such as piracy will continue to be a challenge to TV.
– Second screen and content strategies will be key to TV’s sustainability
– Newspaper publishers will continue to see declines in their print ad revenues with a CAGR of negative 7.5% to $1.69 billion by 2017. The industry generated $3.47 billion in ad revenues in 2008.
– Increase in digital advertising for traditionally print publishers will not offset the loss of print ad revenues.
– Radio ad revenues will grow at a CAGR of 1.8% by 2017 to $1.16 billion.
– Australian radio advertising market is mature and resilient but traditional broadcasters will face increasing pressure from digital streaming services and internet radio.
– Out-of-home will grow at a CAGR of 3.8% by 2017 to $654 million.
– The continued fragmentation of audiences will benefit the out-of-home market.
– Digital technology, urbanisation and travel will continue to fuel growth and innovation in the market.
– The consumer magazine market will have a negative CAGR of 2.7% by 2017 to $474 million.
– Consumer magazines will continue to decline until 2017 but should digital revenues for magazine publishers will make a sizeable contribution to the bottom line.
– Circulation revenues will continue to decrease until 2017 when it will grow 1%.
– The cinema advertising market will have a CAGR of 5.1% by 2017 to $126 million.
– Australian box office admissions will have a CAGR of 2.1% by 2017 to 96 million.
– Box office spending will have a CAGR of 4.4% by 2017 to $1.39 billion.
– Exhibitors and cinema ad networks will bring forth increasingly sophisticated methods of targeting viewers with data from loyalty programs.
– 72% of cinema screens are now digital and 57% are 3D compatible.
– Digital sales are increasing rapidly and offsetting the declines in physical retail distribution.
– Overall market revenue will increase at CAGR of 1.5% to $1.33 billion, which includes digital distribution, physical distribution and live music events.
PwC say the smart use of data will be key to ensuring the sustainability of businesses, especially at a time when brands can be overwhelmed by the sheer amount of data they have access to. But reduced costs in technology such as bandwidth and processing should help.