Ad Uptick Revised to a Blip

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TNS Media Intelligence has downgraded its growth projections for 2007, predicting that U.S. ad spending will only advance 1.7%, to $152.3 billion for the year.

Its previous forecast called for a growth rate of 2.6% for 2007 compared to last year, but TNS revised its figures once it received the actual spending data for the first quarter of this year reflecting a softer-than-expected market. (“Cable, Web Bright Spots In a Sluggish Market,” June 11, 2007, p. 19).

According to that report, only six of 19 media demonstrated gains in the first quarter. Total advertising expenditures declined 0.3%, to $34.93 billion from just over $38 billion in the corresponding year-earlier span.

Activity should pick up slightly in the second half of the year, said TNS CEO Steven J. Fredericks, but it appears total measured expenditures will post their smallest annual gain since the ad recession that followed the Sept. 11, 2001, terrorist attacks. The drop is attributed to a decrease in spending on “old” media in favor of less-expensive digital initiatives.

The forecast calls for an increase in ad spending of 1.2% across media for the first six months, compared to 2006. Conversely, TNS is pegging the second-half growth rate at 2.3%.

TNS predicts cable-network advertising will grow 5.9% over 2006 rates, which would mark the largest rise in any TV sector — over-the-air and syndicated TV are projected to advance at a respective 1.3% and 1.2% clips. TNS forecast for other gainers: Internet (16%); outdoor (4.6%); consumer and Sunday magazines (4.5%); Spanish-language media (3.7%). On the down side, TNS calls for ad-spending decreases in radio (.3%), business-to-business magazines (1.5%), newspapers (2.9%); and spot TV (5.5%).

Cable’s ad-sales growth is attributed to the ability of niche networks to attract advertisers, according to the report. The Internet growth is a reflection of advertiser acceptance of that platform as growing part of their media buys.

<p> </p><p> <strong id="d9e48-14-strong">Growth vs. 2006</strong> </p>

Internet*

+16%

Cable Network TV

+5.9%

Outdoor

+4.6%

Consumer, Sunday magazines

+4.5%

Spanish language media

+3.7%

Network syndication

+1.3%

Syndication

+1.2%

Radio

(-0.3%)

BtoB publications

(-1.5%)

Newspapers

(-2.9%)

Spot TV

(-5.5%)

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