Ad spend in U.S. down 11.5% Q1-Q3


According to Nielsen, spending on advertising fell 11.5% in the first three quarters of 2009, compared to the same time period in 2008. Preliminary figures show that expenditures fell $10.9 billion to a total spend of $83.4 billion in the first nine months of the year.

Cable TV (+ 9.1%), Spanish Language Cable TV (+36.7%), and Free-Standing Insert (FSI) Coupons (+11.2%) were the only three measured media to post any growth. The remaining media suffered declines, ranging from Internet (-0.5%) to Local Sunday Supplements (-48.3%).

“The struggling economy continues to take its toll on the advertising industry, with most sectors lower than last year,” said Terrie Brennan, Senior VP for New Business Development at Nielsen. “In general, television – particularly cable television – seems to be holding up better than print-based media. For example, Local Newspapers have seen 12,000 fewer advertisers in their pages in 2009. Meanwhile, nine of the top ten Cable TV advertisers have increased their spending in the medium so far this year.”

Year-to-Year Change in Ad Spend by Media
Media Category* 1Q-3Q 2009
vs. 1Q-3Q 2008
Spanish Language Cable TV 36.7%
FSI Coupon 11.2%
Cable TV 9.0%
Internet** -0.5%
Spanish Language Network TV -4.6%
Spot Radio -9.6%
Network Radio -10.2%
Spot TV 101-210 DMAs -12.6%
National Sunday Supplement -13.6%
Network TV -13.9%
Local Newspaper -14.0%
Outdoor -15.1%
Syndicated TV -15.9%
Spot TV Top 100 DMAs -16.0%
National Magazine -21.4%
National Newspaper -21.6%
Local Magazine -25.0%
B-to-B Magazines -33.1%
Local Sunday Supplement -48.3%
Grand Total -11.5%
Source: The Nielsen Company 2009
* All data from non-Internet media pulled from Nielsen’s Ad*Views database
** Internet advertising expenditures pulled from AdRelevance database and account for CPM-based, image-based advertising. These reported estimated expenditures do not account for paid search advertising, text only, paid fee services, performance-based campaigns, sponsorships, barters, in-stream (”pre-rolls”) players, messenger applications, partnership advertising, promotions and email campaigns, or house advertising activity.

Spanish language television’s ad spend (cable and network combined) fell a slight 0.7%, while African-American TV (a subset of Network, Cable, Syndicated, and Local) enjoyed a 31% increase in spending. Overall, TV ad spending fell 8.3% year-to-year through the first three quarters. But ads placed on television accounted for 56.8% of all advertising expenditures so far this year, up two%age points over the same period in 2008.

Product Category Advertising
Automotive continued its reign as the top ad-spending category through the first three quarters of 2009, despite a nearly 31% decline. The Pharmaceutical category placed a far second, even with a 4.6% decline of its own. Only two categories in the top ten showed any growth: Direct Response Products (+3.3%) and Quick Service Restaurants (+1.8%).

Top Ten Product Categories by Ad Spend
Product Category Q1-Q3 2009 (millions) Q1-Q3 2008 (millions) % Change
Automotive(Factory & Dealer Assoc.) $5,392.8 $7,802.7 -30.9%
Pharmaceutical $3,236.9 $3,391.9 -4.6%
Quick Service Restaurant $3,073.6 $3,019.8 1.8%
Wireless Telephone Services $2,545.7 $2,690.8 -5.4%
Department Stores $2,472.3 $2,543.6 -2.8%
Motion Picture $2,457.3 $2,499.1 -1.7%
Auto Dealerships – Local $2,414.7 $3,305.4 -26.9%
Direct Response Products $1,840.1 $1,780.7 3.3%
Restaurants $1,193.3 $1,237.5 -3.6%
Furniture Stores $1,069.7 $1,152.9 -7.2%
Total Top 10 Product Categories $25,696.3 $29,424.3 -12.7%
Source: The Nielsen Company
NOTE: Data excludes B-to-B Magazine spending

Further Nielsen analysis of the top product categories unveils some revealing insights on where their money was spent through the first three quarters of 2009:

Almost 70% of all U.S. ad spending by the top ten product categories was invested in television.

Despite Pharmaceutical’s overall decline, the category upped its radio ad spend 137% and its Internet spend increased by one-third.

Television ad spend by Quick Service Restaurants remained essentially flat year-over-year, but the category dramatically boosted its print (+42%) and Internet (+88%) budgets.

Local Auto Dealerships dropped their overall ad budgets 27%, but increased Internet ad spends 45%. The category is also the only one out the top ten that spent more on print media ($1.5 billion) than TV ($610 million) in the first nine months of the year.