HAROLD Mitchell is not only a corporation leader, but the leader of an entire industry. The Mitchell Communications Group executive chairman and jocund ad tycoon was the recent headline act at the Gold Coast Business News business luncheon at Sheraton Mirage, where he shared an insight into the shifting advertising and marketing landscape.
Digital media has evolved from a technological breakthrough into a massive marketing outlet in a small period of time. You’ve been in media advertising since 1976, how has the significance of the last decade changed the business world for the long term?
Well television arrived in 1956 in Australia, radio has been here since 1932 and the internet arrived in 2000 – so there have always been advances in media technologies. Back in 2000 however, I thought there was definitely something different in the digital format.
Our business has always been about marketing media, we deal with mass markets, mass media. Television had been our market as people sit down in front of the television sets and it was very much a group thing, but the world was changing.
New marketing people were arriving and their clients were saying that ‘we want a target audience of individuals’ and I thought the internet was just the absolute in individual targeting marketing – that is each person, one at a time.
The internet is completely interactive whereas all other media today is largely passive. The television is there, but often in the background whereas the internet user is captured.
With digital outlets strongly competing with traditional broadcast media, there has been talk of the death of print. Is there any merit in these predictions?
Not at all. Some forms of print will change but newspapers and magazines will always be here. It’s true that the digital world is amazing in advertising terms. It now takes 18 per cent of all ad dollars, and we are predicting that by 2013 the digital businesses will take 35 per cent of all ad dollars.
That growth in 13 years took television 25 years to achieve, so that’s how dramatic and changing it is. The value of newspapers and other print media will change but it’s not the end of any other media that’s already here.
All those media forms are still here including print, and print will be around for a very long time.
You often say the advertising sector is the best space to gauge the economy. What signs are you seeing first hand in the recovery?
Advertising is something that if things are good and you’re getting a return on your investment, you’ll keep doing it – but if you’re feeling nervous you will pull back, and more importantly, you can pull back very easily.
At the beginning of 2007 we looked at advertising growth year on year as we always do, and I said to the board that we will hit a wall within 18 months because advertising is running ahead of the curve.
It wasn’t as the prime minister said ‘the greatest downturn since the Great Depression,’ – I’ve always said that’s rubbish. I’ve been through four downturns and I can tell you two things. One, they start. Two, they finish.
I’ve been publicly saying since last October that as of this current year, hang on for the ride. And the advertising industry, which is reflective of the broader community, is now roaring ahead.
The mean for the advertising industry is 15 per cent up (on the previous FY) and our business is 25 per cent up. So advertising in Australia is a good place to be right now. Every business will be competing this year. The only way that you can get ahead is by marketing and marketing is advertising.
Is that an indication of the Australian economy’s welfare compared to the rest of the world, and who will take the spotlight on the global stage?
We’re ahead of the rest of the world because we have an incredible range of commodities and we will always have it. There are flat spots in some states but Australia overall is incredible. We have growth, that will continue; and we have stability, that will continue.
Asia is the future of the world; it will essentially become the largest economy of the world. We’ve just come back from Hong Kong because we are linking ourselves to this growth corridor. Back in Australia it is the resources that are carrying on, that got us through the last period and will do it all again.
Around the world, Europe will struggle and will do so for a long time. In America, unemployment is at 10 per cent and 40 per cent of mortgages have a debt that is larger than the value of their home.
But the spirit of Americans is that they will keep pushing on, and even though they have only 5 per cent of the world’s population, they have 25 per cent of the world’s growth. Progressively though, everyone will be looking north to China, and over to India which is where the future is.
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