Total ad expenditures in 2005 increased 3.0% to 143.3 billion compared to 2004, according to data released by TNS Media Intelligence. Total ad spend during Q4 '05 also advanced 3% against the same period in 2004.

The majority of 19 media measured by TNS MI experienced growth during 2005. Internet display advertising registered the largest gain, up 13.3% to 8.3 billion on the strength of accelerated spending from dot-com brands. For the year, these online brands accounted for 49.7% of total internet expenditures, the highest level since the dot-com bust.

---

In addition, Cable TV advanced sharply, up 11.4% to 15.9 billion as it continued to take share from other national media. Other notably strong performers were Outdoor, up 9.8% to 3.5 billion, and Consumer Magazines, up 7.5% to 21.7 billion on the strength of higher rate card pricing.

Local Newspaper led with most total dollars spent at 25.1 billion, up 1.1% compared to 2004. Network TV was the second leading category with 22.5 billion, a decline of 0.3% versus the Summer Olympic year of 2004. In the fourth quarter, a period unaffected by Olympic comparisons, Network TV achieved growth of 4%.

Ad Spending by Advertiser

The top 10 advertisers of 2005 spent 18.6 billion, a drop of 3.3% compared to 2004. Spending by these elite companies softened noticeably in the fourth quarter, with eight of the ten registering declines.

Procter & Gamble, with Gillette now counting towards the parent company total, regained the top spot with 3.2 billion in spending, down 4.6% on a like-for-like basis against 2004. General Motors holds the second position with 3.0 billion in spending, up 7.1%. Verizon had the largest growth rate among the top ten, up 8.5%.

The largest decrease among the top 10 advertisers was AT&T, with a 26.4% drop to 1.6 billion on cutbacks in its wireless divisions associated with the SBC Communications merger. Daimler Chrysler reduced its 2005 advertising outlays by 12.8% to 1.6 billion. The drop was spread across all its major nameplates.

Ad Spending by Category

While automotive continued as the dominant ad spending category in 2005, the segment turned in its first full year decline since 2001. Non-Domestic Auto, with over 8.7 billion in expenditures, was down 1.9% compared to 2004. Domestic Auto spending weakened sharply in the last quarter and posted a full year decrease of 3.7% to 8.5 billion.

Direct Response was the category with the strongest growth, up 15.1% to 6.1 billion and has now recorded eight consecutive quarters of double-digit gains. Additional categories with strong growth included Financial Services, up 8.1% to 8.3 billion, and Restaurants, up 5.7% to 4.9 billion.

Branded Entertainment

TNS continuously monitors Branded Entertainment within network prime and late night programming. The tracking identifies Brand Appearances and measures their duration and attributes. In Q4, an average hour of prime time network programming contained 4 minutes, 24 seconds (4:24) of in-show Brand Appearances as compared to 17:35 of commercial messages, a ratio of just 25%. Reality programming had an average of 11:05 minutes per hour of Brand Appearances as compared to just 3:07 per hour for scripted entertainment programming, such as sitcoms and dramas. Both figures are far less than the comparable volume of regular ad time.