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Half of all advertising dollars now spent online

Tim Murphy

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MediaRoom: New Zealand businesses spent $320m less on advertising in the pandemic year of 2020 than in 2019 – with firms turning to digital ads and away from traditional media in a big way. Tim Murphy reports.

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As businesses hunkered down last year – and then fought hard to get their products back in front of the public – they used direct digital advertising in record numbers, taking its share of all advertising spend in New Zealand to just on 50 percent.

The overall spend on advertising fell steeply, from $2.76 billion to $2.45b, but it was the ‘non-media’ digital sites and platforms that grew despite shrinking ad dollars.

Digital-only advertising, as recorded by the advertising industry’s annual revenue report for 2020, was up 12 percent to $1.2b, having snuck over the billion dollar mark only in 2019.


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As firms found their own way to customers, they cut their spending elsewhere.

The value of advertising in newspapers dropped by $66m to $210m last year. Newspaper advertising has long been pressured but the pandemic accelerated its fall. In 2019 it had reaped $276m, the year before that $324m and in 2017 $353m.  That is a 40 percent reduction in ad income for newspapers in just three years.

Newspapers’ digital sites – such as nzherald.co.nz and stuff.co.nz – also fell last year, down $13m to $86m after years of growth.

Television advertising fell $69m to $469m, a number that was $100m higher just three years ago. Television’s digital sites held pretty steady for advertising dollars in 2020, up $3m to $44m.

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Radio spend fell steeply in the year of Covid – down $44m to $233m (off 16 percent year on year), but radio’s digital ads raked in $1m extra to a total of $5m.

Out-of-home advertising, such as billboards, street and other public signage, was hard hit, down $46m to $128m (a quarter less revenue spent on those ads).

In 2020, the shares of the ad market were:

Digital only: 49.26 percent (up from 38.9 percent in 2019)

Digital via TV, radio, newspapers: 5.5 percent (6.4)

Total Digital: 54.8 percent (45.3)

Total Television: 20.9 percent (20.9)

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Total radio: 9.7 percent (10.1)

Total Newspapers: 12.1 percent  (13.5)

Outdoor: 5.2 percent (6.3)

The figures come from the Advertising Standards Authority’s 2020 NZ Advertising Industry Revenue report. Magazine revenues were not recorded for 2020 because of the disruption to their circulations by law under the Level 4 lockdown and the closure and absence of the former Bauer titles for much of the middle of the year. The ASA said collecting meaningful data was impossible.

Its findings were hailed by the Interactive Advertising Bureau (IAB) which said the 7 percent rise in digital advertising last year in a shrinking market meant a 20 percent growth in market share for digital revenue.

The IAB said the fourth quarter of 2020 saw $412 in digital advertising, a jump of 19 percent on the same period in 2019.

“Given the surge in digital advertising share of … industry turnover in 2020, it’s clear that those businesses that pivoted and changed their business or media strategy based on the market and consumer insight, increased their use of digital advertising to support their business goals, including emerging data-led and e-commerce initiatives.”



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