MEDIA owners and companies need to start investing in their products again or risk losing the confidence of advertisers as they return in strength to the sector after the worst advertising recession in years, a senior media buyer has warned.
The regional chief of Universal McCann, Henry Tajer, said that after a year in which budgets were slashed and costs pared back, media owners needed to restore confidence in the $12 billion advertising market by putting money back into their main products and to keep innovating.
''We are keeping an eye on the dollars they plan to invest back into their products,'' said Mr Tajer, whose clients include the federal government and Coles.
''I've not seen any major investment, but we are still working through the current financial year. By July 1 we really would expect to see [plans]. We have a very strong market and their plans should be in progress at the moment.''
Mr Tajer said he realised media owners spent last year grappling with a recession in the advertising industry - the consensus is that the market shrank 8 per cent - but media owners needed to show advertisers that they were launching new products, adopting new strategies and working to come up with more and different solutions for advertisers.
''If there are signs that they are putting investment back then that'll give the [advertiser] market confidence. After all it is a two way street,'' he said.
The joint national managing director of OMD, Leigh Terry, said his company had not witnessed media owners cutting back areas that ''generate revenue'' - that is the sales teams that put together deals for advertisers. He said that as the market returned he expected to see ad sales targets to be revised upwards, which in turn could lead to investment down the line.
But media owners rejected Mr Tajer's comments, saying that investment had not stopped. The chief sales and digital officer at Seven, James Warburton, cited as evidence to the contrary the launch last year of its advertorial unit, Infocus, a new magazine in Prevention and SMG Red, the division it set up in November to sell advertising packages across its television, magazine and internet businesses. ''I agree with his sentiment in that we need to invest… I don't want to see any commoditisation in the media. But we continued to invest in one of the worst years ever,'' Mr Warburton said.
The trade marketing director at Fairfax Media, Elizabeth Ross, disputed Mr Tajer's contention, saying the move by The Age and the Herald to a tabloid format for the business sections, the relaunch of the magazine Sunday Life and the launch last March of the magazine Sport & Style demonstrated the company continued to invest.
''We might have battened down the hatches last year but we never stopped investing, only now we can see our way clear. We have more planned for Drive and Domain and we will continue to launch more apps [for the iPhone].''
