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U.S. Ad Spending Falls 15%

Cable television the lone bright spot during brutal first half.

Brutalized by the economic recession, spending on advertising in the U.S. fell more than 15 percent during the first half of the year, according to a new report by Nielsen released Tuesday.

 

The slide was equal to about $10.3 billion in ad dollars lost between January and June, compared to the same period last year.

 

Among the 19 media categories tracked by Nielsen, 17 of them saw first half ad spend declines.

 

Hardest hit were local Sunday newspaper ad supplements, which were down more than 45 percent. National newspapers and consumer magazines were down 22.8 and 21.2 percent, respectively. Local newspapers were down 13.2 percent; local magazines fell more than 25 percent.

 

B-to-B magazines, like the ones Nielsen publishes, were down 33 percent.

 

Radio spending slid 9 percent, while ad buys for network television dipped 7 percent.

 

Even Internet ad spending was down 1 percent.

 

There was one bright spot, however: Cable television, which was down 2.7 percent in the first quarter, rebounded in the second to finish the first half up 1.5 percent.

 

In terms of categories, Detroit is still the biggest source of advertising spending, despite the auto makers cutting back more than 31 percent, or $1.68 billion worth of advertising from their budgets. Local auto dealerships also cut back spending significantly, declining 26.2 percent in the first half of 2009. Hollywood continued to spend, too. Motion picture advertising ticked up 1.7 percent during the first half to more than $1.7 billion.

 

The biggest increase among product categories with a minimum of $200 million in spending were for smartphones and PDAs, as marketing for Apple’s new iPhone drove the category’s 104 percent increase.

 

Cable TV Services picked up its ad spending 62 percent to almost $500 million, a result of ad buys leading up to the DTV transition in June.

 

“What’s interesting is that we’re not just seeing a rise in spending for recession-friendly products like fast food restaurants,” Annie Touliatos, VP for Nielsen’s advertising information services, said. “We’re seeing a lot more promotion of smartphones, computer software and consumer-driven web sites. These advertisers see potential for their products despite our stressed economy.”

First Half Ad Spend by Media Category:

Cable TV 1.5%

Spanish Language Cable TV 0.6%

Internet -1.0%

FSI Coupon -5.5%

Network TV -7.0%

Network Radio -9.0%

Spot Radio -9.1%

Spanish Language TV -10.1%

Syndication TV -11.6%

Local Newspaper -13.2%

Outdoor -14.9%

Spot TV Top 100 DMAs -17.4%

National Magazine -21.2%

National Sunday Supplement -22.4%

National Newspaper -22.8%

Local Magazine -25.4%

B-to-B Magazines -31.8%

Spot TV 101-210 DMAs -32.1%

Local Sunday Supplements -45.7%

Total -15.4%

SOURCE: Nielsen