ZenithOptimedia is expecting increases in ad spend of 3.5% in 2012 and 2013, according its latest forecast. The increases come on top of a year of recovery in 2011 that should see advertising grow 2.2%, according to Zenith. The outlook is in part the result of strong U.S. retail sales, which grew 7% in October and got a boost from record Black Friday sales of $11.4 billion, ZO said.
Zenith also had some good things to say about radio: “Despite recent unenthusiastic reports about the state of our economy, network radio seems to be holding its own. According to the latest Miller Kaplan report, network radio had a very strong October –up 6.5% versus a year previously. Retail scatter campaigns promoting multiple sales events are the main driver for increased dollars. With a very strong October and many holiday sales events, including scatter campaigns placed for November and December, wee are revising our previous prediction of 2011 network radio from 2.0%% to 3.0%. Other categories contributing to network radio’s Q4 success are finance and insurance. As for popular radio formats, live sports, sports talk and news/talk are reporting strong numbers in latest PPM. The NBA lockout has led to dollars being re-expressed in NCAAA football and basketball, and NFL. With the Presidential election being a year away and Republican debates in full swing, we are also seeing a surge in talk programming.”
The spot TV marketplace during the first half of 2011 was robust and strong in many categories: “Unfortunately, high gas prices and a decline in consumer confidence have resulted in local markets slowing in the flow of business. There is strong growth, 43%%, in the first half of 2011 for medicines and proprietary remedies, while pharmaceutical houses showed a 74% decrease in spend on Spot TV.”
For 2012 national cable is expected to be up 10% and, thanks to an election year; spot TV should gain 8%; Network is expected to drop 1% and a 12% drop in syndication.
Zenith says cable will have a larger share of ad spend than the broadcast networks in 2011, and that that trend will continue for the foreseeable future despite the Olympics returning to NBC in 2012.
“Cable networks will continue to build momentum – especially those seen as alternatives to broadcast prime (USA, TBS, TNT, FX), largely thanks to the return of big-spending automotive and financial advertisers,” according to Zenith.
The report added, “In real terms, the broadcast networks are not making the same ad dollars as they did several years ago. In an effort to generate new streams of revenue, networks are looking to licensing and retransmission fees.”
On a global basis, Zenith expects the ad market to grow 4.7% in 2012 following a 3.5% gain in 2011.
RBR-TVBR observation: Broadcasters remember, the more you know about the consumer and their buying intentions and behavior the better your local sales efforts will increase. It is all about the Consumer!
RBR-TVBR note: Look for RBR-TVBR in the New Year with Key SPECIAL Exclusive Consumer Retail Reports for Radio and TV with our partners at BIGresearch. Useful intelligence to help you in business and your personal career.