New agency in charge of govt media, cuts feared

The federal government has dropped a print-friendly agency from its master media contract, as printers brace for advertising cuts in the upcoming slashed Abbott budget.

Government spend on print advertising has been falling steadily in recent years, and could be up for another shave with cuts across the board and a new agency in the top spot.

In FY2013 press advertising made up $17.5m of the $138.9m campaign spend, down from $23.4m in the previous year. Out-of-home (print and digital) was allocated $4m, and magazine advertising got a look-in at $3.7m.

Television won the lion’s share at 64.9 per cent in 2013, followed by digital at $29.1 per cent – trending up from 2012 figures.

Outgoing agency UM Australia, which lost the master media contract to Japanese-owned Mitchell & Partners despite holding the job for 11 years, is known for its creative work in print as well as other mediums.

The agency instigated a $96m revenue lift for News Corp in its 2013 ‘Fast Front Pages’ campaign, which displayed the morning’s newspapers on 370 printed billboards across Sydney, Melbourne and Brisbane.

The billboards went up at the crack of dawn each day for eight weeks, with outsourced printers sharing the 370-poster-a-day job – each taking five minutes to print and installed by teams from 3am.

For the first time in two years News Corp increased its newspaper circulation by between nine and 10 per cent, and newsstands near the campaign sites saw sales jump 25 per cent. UM won awards for the job, and was named fifth most innovative company for 2013 by BRW.

Incumbent contractor Mitchell & Partners has signed on to manage the government’s advertising for at least the next four years; which last year added up to $160m but may be taking a dive in 2014.

While the Coalition is historically thought to spend more on advertising than Labor governments, the Australian Financial Review speculates that Abbott’s budget is likely to prove an exception. And with a new agency holding the reins, it is uncertain how much media spend will fall into the lap of printers.

Mitchell & Partners is forthcoming about digital as an emerging marketing medium but does not advertise its stance on print.

Parent company Aegis Global says its Australian clients spent $3,460m on newspaper advertising in the first half of FY2014 – falling 8.5 per cent from last year but still making up 25.2 per cent of total expenditure across its four Australian companies; Mitchell, Carat, Huckleberry and digital-only Vizeum.

Across Aegis’ Australian operations digital currently leads at 30.3 per cent of expenditure, television second at 28.3 per cent – magazines only grabbing 4.3 per cent and outdoor 3.9 per cent.

Mitchells’ alliance partner, Adcorp – understood to be managing the non-campaign side of the government deal – argues that the future of advertising is digital, stating on its website that “newspapers, magazines, television and radio have been usurped by the PC, smartphone, iPad and tablets, and now, smart television.”

The Coalition will announce its budget on Tuesday, May 13.

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