Best of the Week: Good enough; and Adland’s economic headwinds

[View web version]( BEST OF THE WEEK [Cooperate]( And another thing... August 10, 2019 Welcome to Best of the Week, written in windy Cremorne. Windows are banging, the wind is howling through the trees, and the cats are reproaching me about the disturbance. Today’s writing soundtrack: The Flaming Lips - Yoshimi Battles The Pink Robots. Can that really be 17 years old? And it’s been one of those frustrating weeks where I was never fully on top of things. Across the week, good enough has had to be good enough. Mostly, I get to enjoy the luxury of my contribution to Mumbrella being one of trying to make a final 1% improvement. Not this week. Staff illnesses and a vacancy on the editorial team saw the bar set lower than usual. This week consisted of that guilty feeling of being spread too thinly to help the short-handed news team as much as I would have wanted, while falling behind on other commitments anyway. I suspect that everybody’s triggers for workload stress are slightly different. For me, it’s when it’s simply not possible to do a good job on everything. Regardless, I’d always take busy over boring. I started the week with meetings in Melbourne, before Tuesday saw me taking a late night crash course in all things Gary Vee as a last minute stand-in to interview him for the Mumbrellacast the next day. We’ll upload the Gary Vee interview next Thursday. Spoiler: We did get to discuss his public differences with Mark Ritson. More on Mr Vaynerchuk next week, I suspect. And after a 13 hour day on the newsdesk, by Wednesday night, I was still concerned about how our team would go at getting the daily newsletter out of the door the next day, given that we were also running the Mumbrella Automotive Summit at the Four Seasons in Sydney. The incidental news that one of our international keynotes, flying in from the US via Japan, had not been allowed to board his Australian flight because of a visa issue, seemed in keeping with a week that wasn’t going entirely to plan. In the office, we use the work collaboration tool Slack a lot. Before I locked up on Wednesday night, I went on to our editorial Slack channel to try to set a realistic bar for the members of the news team still standing: “To be clear what success looks like tomorrow: Getting a newsletter out of the door, with stories between the ads. That's it. We may not be as good as we usually are. But we'll be good enough.” I meanwhile, then spent most of Thursday morning in our monthly board meeting, two floors up from the summit and one floor up from our temporary newsroom, feeling bad at not being able to offer the journos more help. Actually, they were fine. They didn’t need me. So it was a relief to emerge at lunchtime to see a message from our journo Brittney Rigby on our “wins” Slack channel: “Our itty bitty news committee (featuring @Zoe Wilkinson and a very unwell @Hannah - what a trooper) is down an editor (poor Viv is home very sick) and a Tim (poor Tim is here, in a board meeting), but still managed to get out a newsletter this morning well ahead of deadline with 17 stories (sub-edited and published by each other). “Not bad for a new team of three (2.5 if you take into account Hannah's half-deadness) when the measure for "success" was having stories, any stories, between ads.” Good enough was more than good enough. (And yes, the company does have a Slack channel to recognise our wins.) After a quick dash around Sydney to look at potential new office space,it was time for the afternoon’s [Mumbrellacast]( recording, done in a corridor at the Four Seasons. My preparation was also lighter than usual. Put it in the “good enough” category again, I hope. And as you’ll hear, our conversation was somewhat less structured than usual. Our two big topics were last week’s departure of Nick Garrett from Clemenger BBDO, and the new data we’ve seen this week about the health or otherwise of the advertising market. And for me that media market is the big industry theme of the week. We’re in results season, and, so far, nobody is having fun. And as well as updates to the ASX, there’ve also been numbers put together from Deloitte, KPMG and SMI carrying broadly similar bad news from every direction. At our auto summit, I managed to see most of Standard Media Index boss Jane Ractliffe’s authoritative presentation. SMI records where media agencies are spending their brands’ advertising budgets. And the preso showed how tough things are in the automotive sector. Advertising spend by auto brands is down by 10%, and, if I heard correctly, by 50% in outdoor. This week there was also new data compiled by Deloitte for Commercial Radio Australia. [The radio industry saw a 1.7% decline in revenue in the last quarter](. In another intriguing dynamic contained in those numbers, Melbourne is now a much bigger radio market than Sydney - with revenue for the quarter of $68m compared to $63m. It’s not the first time I’ve seen that occur, but a $5m gap between the two cities is the biggest I can remember. Sticking with radio, on Wednesday afternoon, [Macquarie Media was one of the first out of the gate for reporting season](. Macquarie Media includes Sydney’s 2GB and Melbourne’s 3AW, which are the top rating stations in their respective cities. When Nine bought Fairfax Media, it ended up with a majority stake, although John Singleton still owns about a third. Against the backdrop of the CRA numbers (and the now settled saga of whether 2GB would re-sign Alan Jones), it was not a major surprise to see Macquarie Media reveal a 3.3% fall in revenue. But until Nine decides whether it’s a buyer of the part of Macquarie Media it doesn’t already own, it feels like the company will be treading water on its strategy anyhow. There’s a big gap between the company’s ratings performance and commercial performance, Speaking of Nine and the TV networks, the watershed moment of the week came for me with Think TV’s numbers for the 2019 financial year, compiled by KPMG. For as long as I’ve been writing about media in Australia, I’ve always had a useful round number in my head: TV advertising in Australia is worth $4bn. Only it isn’t any more. [Now it’s fallen below $4bn]( for the first time. That number takes into account advertising on Seven, Nine, Ten and Foxtel, along with the regional networks. It’s no surprise that the numbers were down. SMI puts out data every month that shows the way the wind is blowing, so we’ve known for months that it would look something like this. But nonetheless, it was the best evidence yet that we’ve been going through a media recession. I doubt it was a coincidence that on Thursday Seven West Media hit the lowest share price in the company’s history, giving it a market capitalisation of just under $600m. Funny to think that these days Nine has five times the market cap of SWM, while even Southern Cross Austereo is 50% bigger. [News Corp announced its quarterly numbers this week]( too. The story was a familiar one - traditional subscribers to Foxtel turning away, while new subscribers to the Kayo streaming service surge. And print revenues falling while digital subscribers grow. With results season due to stretch over the rest of the month, we’ll get a better picture of just how difficult things are. And the tough times stretches beyond the media sector, and indeed beyond Australia. The holding companies are struggling too. Earlier this week, Dentsu revised its global forecast for the calendar year downwards. It told the market that revenue would be down by 4% and net profit down by more than 40%. Outside its home market of Japan, Dentsu flagged two markets as being particularly problematic - China and Australia. Mind you, not all of Dentsu’s problems in Australia are because of the economy. There’s a growing industry consensus that new boss Henry Tajer has inherited a mess. And holding company WPP is still having a tough time globally too. Later today (I’m on the newsdesk this weekend) I’ll be writing up the numbers WPP released out of London last night. At first look, they show that globally profits are down by about 8%. But one thing is worth bearing in mind: All this data can only ever offer a rear view mirror, and when the market turns, there’ll be a lag before that is reflected in the numbers. I don’t think that’s happened yet, by the way. But I also don’t get any sense that things are getting any worse. Maybe we’ve hit bottom. And in this week of good enough, maybe that’s good enough. Time for me to read some newspapers and write some news stories. Please do drop me a line to tim@mumbrella.com.au. Have a great weekend. Toodlepip... Tim Burrowes Content Director - Mumbrella [Cooperate]( Mumbrella | 46-48 Balfour Street Chippendale NSW 2008 Australia This email was sent to {EMAIL}. If you would rather not receive Mumbrella's Best of the Week email you can [unsubscribe]( or [manage subscriptions](. [Facebook]( [LinkedIn]( [Twitter](