Cable Trailing Three in Ad-Spending Rise

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Finishing fourth among the various sectors in terms of growth rate, cable-television advertising expenditures rose 16.1% in the first nine months of 2004, easily outpacing media spending as a whole.

In chalking up the healthy double-digit advance, cable recorded $10.49 billion in ad dollars through the end of September, according to TNS Media Intelligence/CMR, compared with $9.035 billion over the corresponding period in 2003.

OLYMPIC BOOST

Overall, advertising expenditures — bolstered by spending on the political races and outlays on NBC and its various cable outlets against the Summer Olympics — climbed 10.3% to $102.4 billion from $92.9 billion in the year-ago period.

“Throughout 2004, the advertising market has experienced steady, healthy growth, with increases in all three quarters,” TNS Media Intelligence/CMR CEO Steven Fredericks said in a statement. “As we forecasted earlier in the year, third-quarter spending for the Olympics and the political season elevated the volume of overall dollars brought into the advertising market.”

Of the 17 categories tracked by TNS/CMR, the Internet rang up the strongest growth, notching a 25.8% advance to some $5.59 billion, up from $4.45 billion the prior year.

Outdoor ads followed with a 17.6% increase to just over $2.4 billion from $2.04 billion. Syndicated TV was third with a 17.3% growth rate to $2.89 billion, versus $2.47 billion in the 2003 span, followed by cable.

BROADCAST BOUNCE

Broadcast-network TV, lifted in large part by the Peacock’s sales against the Athens Games, was fifth, up 14% to $16.4 billion from $14.4 billion. That total trailed only the $17.7 billion that clients allocated in local newspapers.

Newspapers, fueled by spending in the automotive, home furnishings/appliances and clothing/department stores categories, posted a 6.6% increase over the $16.6 billion spent in the same period a year ago.

Spot TV, consumer magazines and national newspapers all lagged the overall ad-spending standard. The former secured a 9.4% increase to $12.3 billion from $11.3 billion the year before, while consumer titles forged a 10% gain to $14.9 billion from $13.5 billion. For their part, national newspapers rolled up a 9.7% increase to $2.45 billion from $2.24 billion.

Gains were far more modest for local radio (up 1.9% to $5.46 billion) and network radio (2.6% to $754 million). National spot radio was the only one of the sectors measures by TNS/CMR that lost ground, sustaining a 2.6% decline to $1.87 billion.

All told, TNS/CMR estimated that advertising revenue against the Summer Olympics totaled $1.55 billion, a 24% jump from the $1.3 billion tallied against the Sydney Games in 2000.

“In an era characterized by audience fragmentation, advertisers recognize the value of advertising during high-profile, must-see events such as the Olympics,” Fredericks said.

Network TV accounted for $1.17 billion on the Games, with some $93 billion budgeted on cable. Local NBC stations garnered $285 million.

GM LED IN THE GAMES

A total of 160 advertisers ran spots on the 16 days of Olympics coverage. NBC’s top five spenders were General Motors Corp. ($106 million), Coca-Cola ($62 million), Anheuser-Busch ($54 million), Visa ($46 million) and AT&T Wireless ($44 million).

According to TNSMI/Campaign Media Analysis Group, spending on political and advocacy commercials reached $767 million over the first nine months of the year.

“This has been an unprecedented election from an advertising standpoint,” Evan Tracey, chief operating officer of TNSMI/Campaign Media Analysis Group, said in a statement. “The new campaign-finance law, which some said would hinder the advertising industry, have actually increased the total spend and allowed for a significant increase in early political-ad spending.”

A breakdown shows that the Republican campaign of President Bush spent $145.5 million through the first nine months of the year, versus $105.3 million for the ticket of Sen. John Kerry (D-Mass.).

Pro-Republican groups contributed $10.9 million, compared to $148.5 million from Democratic backers.

Other political and issue groups combined to spend $356.8 million through Sept. 30.

TNSMI, making its projections based on data accumulated through Nov. 1, estimated that total political ad spending would exceed $1.45 billion for the year.

P&G SPENDS MOST

While GM took the gold for spending the most advertising green on NBC’s Olympics coverage, Procter & Gamble Co. stood atop the medal stand overall for the first nine months of the year. The consumer-products giant increased its media budget 6.7% to $2.13 billion, up from just under $2 billion in the prior year period. TNS/CMR officials said much of the company’s budget went to network and cable TV, as well as consumer magazines.

P&G’s investments in media outstripped second-pace GM by some $140 million. The auto manufacturer steered $1.99 billion across the measured media, 14.6% more than it had the year before.

Time Warner Inc., despite a slight downtick, ranked third, with $1.345 billion in media expenditures during the first nine months of this year, off 0.4% from $1.349 billion. DaimlerChrysler ranked fourth in the period, increasing its ad outlays by 3.4% to $1.22 billion from $1.18 billion.

Of the top 10 spenders, Verizon Communications Inc. upped its advertising ante the most, allocating 21.8% to $1.14 billion, versus $935.1 million. TNS/CMR executives noted campaigns promoting Verizon’s wireless and Internet services as fueling much of the growth.

Rounding out the top were: Ford Motor Co., down 0.7% to $1.08 billion; The Walt Disney Co., ahead 3.5% to $1.07 billion; Johnson & Johnson, up 3% to $933.8 million; SBC Communications Inc., up 9.9% to $916.4 million; and Altria Group, a 5% increase to $836.5 million.

Collectively, the top 10 spenders invested 6.8% more in advertising to a combined total of $12.7 billion, compared with almost $11.9 billion, according to TNS/CMR research.

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