Advertising Agencies in Australia have increasingly integrated big tech and data into their advertising strategies as consumers of advertising continue to depend on the internet. Lockdowns implemented in response to the COVID-19 pandemic have reduced demand for outdoor advertising such as billboards. Consumers are now being driven to shop online, and typically view more advertising content through this medium. As the pandemic continues to drive consumers online, advertising agencies have begun to appoint senior management roles dedicated to utilising technology and data to further enhance their firm’s ability to target consumers in their chosen demographics.
Online focus
Online and mobile advertising has overtaken traditional media as agencies’ main product offering, with 51.1% of services centred around internet-based advertising. As a result, demand for internet publishing and broadcasting is expected to increase at an annualised 14.1% over the five years through 2021-22. This constant growth contrasts with demand for both non-internet broadcasting and demand for newspaper, periodical, book and directory publishing. Demand for publishing in these mediums declined before and during the pandemic.
Industry growth has led to the specialisation of advertising products at a new level. With the internet allowing advertisers to target demographics based on age, gender, interests and a myriad of categories, clients are able to focus their messaging on their target market. This change has affected agencies in a number of ways:
- Advertising firms have increasingly integrated data and analytics into their core business structure
- Creative directors have begun to lose control over the direction of advertising campaigns
- Firms are instead focusing on market research and targeted advertising
- Advertising campaigns have become increasingly number-focused, encouraging a managerial approach to running campaign
Recent appointments
This move towards data-driven advertising has seen both WPP AUNZ Ltd and oOh!media Limited recently appoint senior management position. WPP AUNZ subsidiary Ogilvy recently appointed a new Chief Data & Analytics Officer, while oOh!media introduced a new Chief Technology & Information Officer. The two officers have significant work experience in organisations that have moved their services into the digital realm, and will likely seek to integrate data and analytics into their firms’ practices even further. These strategic moves come after both WPP AUNZ and oOh!media struggled in 2020, with the companies’ revenue declining by 10.7% and 33.4% respectively.
Where to from here?
With the majority of advertising services now focused on online-based advertising, ad agencies are projected to continue integrating data and analytics into their service offerings. The ability to use a consumer’s personal data has allowed advertisers to target key demographics at an unprecedented level. By appointing senior officers with experience in harnessing digital connections, both WPP AUNZ and oOh!media will likely be able to drive a top-down approach towards tailored advertising, attracting clients seeking to target even the most niche customer bases.
IBISWorld industry and company reports used to develop this release:
