NZ online ad spend climbs to new all-time high

Google NZ country manager Tony Keusgen

KeallHauled

Chris Keall

The overall ad market might be challenging, but online ad spending continues to edge up, according to PwC's latest survey for the IAB (Interactive Advertising Bureau).

Spending increased to an all-time high of $94.02 million in the September quarter - a 3% increase over the June quarter, and 5% up on the year-ago quarter.

The bad news - at least for traditional publishers - is that display ads have slipped back.

The increase is in search, directory and classified ads associated with the likes of Google, Yellow and Trade Me:

Click chart to enlarge.

Last year, online (or "interactive") accounted for 15.1% or $328 million of total advertising spending in New Zealand - passing radio ($247 million) for the first time, and catching up with print newspapers (26.7%/$582 million), which lost a couple of points of share, and a flat television market (28.4%/$618 million). 

Total online ad spending by quarter Click to zoom.

In a recent interview, Google's new NZ country manager, Tony Keusgen, told, NBR the search giant's local operation had tripled staff numbers to 12 over the past year.

It has also appointed a third premium Google Ad Words reseller, Gopher, which joins existing Google partners Localist and Yellow.

Google's small team is concentrating its fire on ad agencies and larger companies, while Yellow and Localist are hitting small business. 

It's a full court press - and one focussed on what Keusgen calls "white coat" marketing. The old chestnut "half my advertising works, I just don't know which half” no longer applies in a world of click-throughs and other web-based results metrics, says the Google boss. Display advertising, and the more nebulous concept of brand promotion, is not so much part of his picture.

Mobile ad spending continued to grow in the third quarter, albeit off a very low base. Click chart to enlarge.

Online display advertising by category. Automotive pushed into the top three during the quarter, with banking and finance dropping to fourth. Click to zoom.

Total online advertising spend to date for 2012 is $265 million, PwC says.

That represents 81% of the overall 2011 spend totalling $328 million.

and it surpasses the total 2010 spend of $257 million.

Google NZ country manager Tony Keusgen in his company's Auckland office. Its HQ sits (unmarked, even on the lifts) in a modern office tower, but features meeting rooms kitched out with Kiwi themes including an All Black room and one (pictured) designed to look like a batch.

ckeall@nbr.co.nz

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4 Comments & Questions

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So we have $265 Million in advertising, contributing nothing towards New Zealand. Less jobs for NZers and a bigger deficit for Govt with no Corp tax. If we can't change International Tax laws, offer Facebook and Google a 10% Corp Tax rate if they bring their business here. Better to have them 10% of $265 Million in NZ the current nothing and 11% tax in Ireland

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How in the hell can Google post a loss and pay jack tax?

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Like Facebook (and others), Google books most ad sales in NZ (and other countries) to a subsidiary in Ireland, where the corporate tax take is low.

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Interesting only thing I used Google chrome and firefox browsers and both have ad blockers as addons so I don't see any ads so there wasting there money as far as I am concerned

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