U.S. Advertising Spending Falls 4% in First Quarter
By Steven Perlberg, The Wall Street Journal
U.S. advertising expenditures dropped in the first quarter, as budgets declined among eight of the ten biggest-spending industries, according to a new report from advertising tracker Kantar Media.
Total U.S. ad spending fell 4% in the first quarter versus last year to $37.4 billion. Excluding the impact of special advertising events like 2014′s Sochi Olympics, spending was down 2%, Kantar Media said.
The report comes as many big companies reevaluate their advertising spending and agency structure in an effort to cut costs and navigate the complexities of the digital ad market. Spending by the top 10 ad-spending companies dropped 10.6% in the first quarter, according to Kantar Media. Marketers like Procter & Gamble Co., General Motors Corp. and AT&T Inc. were among those that cut back, though many big brands did spend on TV ads for the Olympics in 2014, which exacerbated the declines.
The automotive industry — which doled out the most for advertising — spent 11% less in the first quarter. The second-largest spender by category, the retail industry, lowered its spending by 9.6%, according to Kantar Media.
The report tracks spending in traditional media like television, newspapers and magazines. While the report includes digital display and search ads, it omits digital video and mobile ad formats, which are increasingly important categories for advertisers.
According to Kantar Media, spending on cable networks grew 4.1%, largely due to the fact that networks are packing in more ad time into their programming to make up for ratings declines. In some cases, networks have even sped up shows or reduced the amount of time they spend promoting their own programs. Excluding the Olympics, spending on broadcast television was flat.
Spending on newspapers fell 15.4% while magazines fell 8.7%.
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