More money will be spent on internet advertising in New Zealand than on television commercials within two years – according to a report by consultancy PWC.
PWC also forecast 2017 would be the year when spending on online directories exceeded the value of adverts placed in the likes of printed directories such as Yellow for the first time.
The firm has been reading the tea leaves of the media and advertising industries for the past 16 years and this year’s report tells a familiar tale.
‘New media’ is on the rise while traditional media such as broadcast television and newspapers battle economic headwinds and changing habits.
PWC digital strategy leader Greg Doone said one of the clearest shifts was towards people watching television and movies ‘on demand’ over the internet at home, because of the convenience and the ability to ‘binge’ view.
“Consumers will increasingly call the shots. What they want is more flexibility – freedom and convenience in when and how they consume their preferred content’ he said.
But PWC forecast a slightly less gloomy outlook for spending on non-online content than it had last year.
It expected it to edge up by 0.1 per cent a year until 2019 rather than to decline by 0.5 per cent annually through to 2018 – as it had previously forecast.
Spending on internet advertising would rise 11.2 per cent a year to hit $737m in 2019 – when TV advertising would be worth $584m and newspaper advertising $317m – it said.
There are signs consumers may be having their fill of internet adverts in some markets.
Reuters reported that more than 30 per cent of Germans were now using ad-blocking software to prevent advertisements displaying on the likes of computers and smartphones – versus about 5 per cent of internet users elsewhere.
That was costing German publishers about US$899m (NZ$1.3b) a year in lost revenues – Reuters said.