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Tag: US ad spend

  • Carat slashes forecast for US ad spend growth in 2005

    MUMBAI: With rising oil prices, the dollar downslide and the US current account deficit being potential causes for concern in 2005, media buyer Carat, a unit of UK-based Aegis has sliced its 2005 global advertising spend forecast.

    The growth predictions cited for 2005 by Carat has dipped from 4.8 per cent in September to 4.5 per cent in 2005 and the global ad spending to increase by 4.9 percent, compared with the five per cent increase its forecast stated in September.

     
     
    The agency has said that despite the fact that the world was experiencing a significant recovery in advertising spending and a continued belief of advertising budgets being on the rise in the US, this action was necessary. This move has simply reiterated the concern marketing executives bear today with the recent economic health of the US.

    UK FORECASTS REVISED UPWARDS

    Interestingly, Carat cut its US ad spends forecast to 4.5 from 4.8 per cent although it has increased UK’s projected growth to 4.6 per cent from 4.3 per cent due to increased British marketing budgets.

    According to agency reports, UK marketing budgets have been revised in the third quarter for the fourth consecutive quarter and this has led Aegis to forecast growth of 6.4 per cent in 2004, compared with previous expectations of 4.6 per cent.

    The US advertising sector space although has witnessed the economic scenario heading towards the slowing of growth and fewer job gains. Also, US corporate profits have seen a slight slump in the third quarter which has led to the decline in consumer confidence in the last quarter of 2004.
    Another factor in consideration are quadrennial events like the Olympics and the US elections which surged spending by about 6 per cent. 2005 is expected to record a drop in spends across most markets.

    ZenithOptimedia and Universal McCann as recently as last month have on the other hand raised their figures of ad spends forecasts this year.

     
     
    2004 saw Carat in Europe exceed the expected growth levels from 4.4 per cent to 4.8 per cent. It put growth in the UK at 6.4 per cent, up from 4.6 per cent.

    Carat has although maintained its 2005 forecast for Europe at 4.4 per cent. But raised its forecasts for Spain from 4.2 per cent to 4.5 per cent and for France from 1.9 per cent to 2.2 per cent.

    Coming to the Asia-Pacific region, advertising spends here are expected to grow by 5.8 per cent compared with 6.2 per cent in 2004. Another pint in note being that advertisers are beginning to respond to the fragmentation of television audiences by allocating more funds to the Internet and in non-traditional media.

     
     
    Carat forecast Internet advertising spend to go up by 20 per cent in 2005 which currently stands at three per cent. The outdoor market was another area pointed out by the agency that would be a strong medium in the years to come which will then evolve to the growth of in-store digital delivery.

  • US ad spend up 4.5 per cent between Jan – Sept 2005

    MUMBAI: Ad spend in the US in the first nine months 1 January – 30 September 2005 rose by 4.5 per cent over the same period last year.

    This was due to gains across major media. Preliminary figures were released by Nielsen Monitor-Plus, the ad intelligence service of Nielsen Media Research.

     

     
    Ad spends increased in almost all reported media, led by the Internet which was up by 19.4 per cent, followed by Spanish-language TV (16.7 per cent), cable TV (11.9 per cent), and local magazines (10.1 per cent). Other media showing gains include outdoor (7.3 per cent), national magazines (7.1 per cent), business-to-business magazines (3.9 per cent), national newspapers (2.2 per cent), and local newspapers (0.8 per cent).

    Nielsen Monitor-Plus MD Jeff King says, “Network TV showed positive growth through the first half of 2005. However, the absence of the Olympics in third quarter resulted in a year-to-date decline. The increase in Spot TV in the top 100 markets was a result of growth in the automotive, retail, and insurance/real estate industries.”

     
     
    A number of media haven’t shown much movement through the third quarter including spot TV in the smaller markets, local newspapers, and network radio. Coupons were flat.

    Ad spends through the third quarter for the top 10 companies reached over $14 billion, up 1.8 per cent from last year. Most advertisers experienced growth. Although DaimlerChrysler cut spends back by 5.6 per cent, overall the automotive companies show healthy gains, accounting for $5.4 billion in spending, with an increase of 2.9 per cent.

    Spending for the 10 largest categories reached over $31 billion through the third quarter. This repersents a 5.1 per cent growth than the same period last year. Most product categories have increased spending, with the exception of local automotive dealerships and department stores, which are each slightly down. The restaurant industry was the fastest growing in terms of per cent increase over last year.

    General Motors, the top ad spender in the US, increased its budget by 7.3 per cent to $2.54 billion, while Ford Motor the number three spender, grew its advertising by 3.8 per cent to $1.6 billion. However the second largest ad spender in the US Procter & Gamble decreased its ad budget by 2.8 per cent to $2.52 billion.

    Other top 10 advertisers that increased spending were Time Warner, Johnson & Johnson, Altria Group. Time Warner increased its spends by 15.5 per cent to $1.20 billion. Meanwhile Pepsi. Disney and AT&T cut ad spends. Disney cut spends by 11.2 per cent to $896 million. AT&T cut spends by 28.9 per cent to $885 million.

    Nielsen’s Product Placement tracking service continues to show significant growth in the integration of product occurrences in primetime broadcast network programming. The top 10 brands in the product placement category totaled 12,445 occurrences through the third quarter of the year.

     
    The top 10 programmes that featured product placements in the first half accounted for 27,244 occurrences. NBC’s The Contender was the number one programme, with more than double the amount of product placements than the number two programme, Fox’s American Idol, 7,514 and 3,497, respectively. Interestingly, these two programmes which are currently not on air still represent the largest number of product placements. Many of The Contender’s placements were for Everlast Apparel and Sporting Equipment, while American Idol’s was for Coca-Cola.
    What I Like About You saw 2,544 placements. ABC’s Extreme Makeover Home Edition got 2,480 placements. CBS’ King Of Queens managed 2,139 placements while NBC’s busines based reality show The Apprentice got 1,996 placements. The Amazing Race on CBS got 1,898 placements.