Online Ad Spending Stays Above Water, Verizon Top Ad Spender
Advertising in general is suffering in 2009, as everyone knows. However, further supporting indicators from earlier this year, it appears that the Internet is faring relatively well in these rough economic waters, and is set to continue its success in the coming years.
According to recent figures released by Myers Publishing, the Internet will finish behind only newspapers as the media with the largest share of the U.S. advertising spending share.
Newspapers are expected to finish 2009 with 14.6 percent of the total spent on advertising in the U.S., a drop from a 16.3 percent share in 2008 and an even further drop from an 18.7 percent share in 2007.
The Internet is expected to take 12.2 percent of the ad spending share this year, or $24.55 billion (a 0.5 percent drop in spending compared to 2008), an uptick from a 10.6 percent share last year. This figure is forecast to rise to 12.9 percent next year, 13.4 percent in 2011 and 13.6 percent in 2012.
Local and national spot TV was third with 10.1 percent of U.S. ad spending in 2009, a drop from 10.9 percent in 2008.
This marks the first time that online ad spending finished above local and national spot TV.
Custom publishing are set to finish 2009 with 9.4 percent of total ad spending, while cable network TV will finish with 8.7 percent, broadcast network TV with 8.3 percent and terrestrial radio with 7.5 percent.
Consumer magazines are expected to claim 7.5 percent, while Yellow Pages (print) will have 5.5 percent and branded entertainment/product placement will have 4.4 percent, to round out the top 10 media by share of ad spending.
Video game advertising (0.5 percent of total spending) is expected to experience the fastest growth this year at 12 percent, followed by mobile (0.4 percent of total spending) with 9 percent growth.
Myers expects total ad spending in the U.S. to plummet 13.3 percent in 2009, a deeper drop than the 12.1 percent decline forecast back in May.
The drop will be smaller in 2010, when Myers forecasts a 4.8 percent decline, and 2011 will see the start of a recovery with a 1.1 percent increase expected.
TNS Media Intelligence recently reported that U.S. ad spending fell 14.3 percent in the first six months of 2009 compared with the same time period last year. Total ad spending during the first half of the year was $60.87 billion.
“Ad spending during the second quarter of 2009 was off 13.9 percent compared to last year, the fifth consecutive quarter of year-over-year declines,” the company noted in a statement.
“Early data from third quarter hint at possible improvements for some media due to easy comparisons against distressed levels of year ago expenditures,” said Jon Swallen, senior vice president of research at TNS Media Intelligence.
TV media experienced a 10 percent year-over-year decline in ad spending for the first six months of the year, while magazine media sagged 20.9 percent and newspaper media slumped 24.2 percent. Radio media also saw ad spending decline 24.6 percent, while spending on outdoor ads decreased 15.7 percent.
The Internet (display ads only) saw a 6.5 percent boost in spending, while free standing inserts saw a 4.6 percent increase in spending.
Verizon Communications Inc. was the top spender during the first half of the year, doling out $1.2 billion, a 3.1 percent boost from the amount it spent in the same span of time last year.
Automotive was the top-spending category ($4.4 billion), though it spent 31.1 percent less than last year.
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