Check Out Our New Look

Ad Spending Will Accelerate In 2014 As Buyers Flock To Mobile: Report

It’s time for ad companies to release their year-end forecasts, and ZenithOptimedia is out today with a bullish one  – largely tied to big increases it expects for ads on smartphones and tablets. ZenithOptimedia logo It projects global spending  in 2014 to hit $532B – a 5.3% increase vs this year which is +3.6% from 2012. (The new projection is up slightly from the company’s forecast in September for spending to grow 5.1% in 2014.) The Winter Olympics and mid-term elections should propel spending in North America 4.6% from this year’s $166.9B, which is +3.3% vs 2012. But mobile is the big story. The medium “is now the main driver of global adspend growth,” it says. “This is the first time in the past 20 years that a new platform is expanding overall media consumption without cannibalizing any of the other media platforms.” By 2016 mobile should become the fourth largest ad medium, ahead of radio, outdoor and magazines, ZenithOptimedia says. This is the first time the company also has made some three-year projections. It says that global spending on mobile will hit $45.4B in 2016, up from $13.5B this year. In the U.S. ad sales for mobile display will increase 239.4% by 2016 to $6.4B. Smartphone penetration will grow to 77.3% from 54% in 2013, while 37.1% will own tablets, up from 23.8%. Over the same period, global ad sales on television will increase by $29.8B, but its market share will slip to 39.3% … Read More »

Comments (0)

Ad Sales Rose 3.5% In Q2, But With A Catch: Report

By | Monday September 9, 2013 @ 5:42am PDT

Ad expenditures, at $35.8B, were up for the sixth consecutive quarter with the strongest year-over-year growth rate since late 2010, Kantar Media reports this morning. But there were big differences between the two April-to-June periods. Last year “spending was deflated by major advertisers who conserved budgets in advance of the Summer Olympics and this makes current year growth appear larger,” says Kantar Media Chief Resaearch Officer Jon Swallen. In addition, the NCAA Final Four basketball playoffs moved from March to April, which “generated a sizable windfall of extra TV ad revenue. Without these factors, Q2 ad spend growth would have been lower by about one full percentage point.” With these idiosyncrasies, total TV ad sales rose 6.4% in Q2 with cable +14.9%, network TV +4.9%, spot TV -3.5% (it would have been flat if you took away last year’s political ads), Spanish language TV +6.1% and national syndication -1.2%. Spending across all media by the top 10 advertisers rose 15.7% to $4.1B but that includes extraordinary increases by companies including Procter & Gamble (+35.3%), AT&T (+33.2%) and General Motors (+28.0%) that kept their powder dry for the Olympics. The top spending media companies in Q2 — mostly buying ads for summer movies — were Comcast (-17.4% to $393.2M), News Corp (+8.2% to $322.5M) and Time Warner (+6.9% to $316.0M). Retailers were the top buyers overall at $3.8B, virtually flat vs last year, followed by auto companies ($3.6B, +6.9%), local … Read More »

Comments (0)

Ad Spending Will Accelerate As Economy Improves: Forecast

By | Monday June 18, 2012 @ 6:45pm PDT

There’s encouraging news for just about everyone except the broadcast networks — and the usual suspects among fading traditional media — in the latest ad forecast out this morning from Zenith Optimedia. The economy “is in a much better place than it was three years ago,” the ad firm says. As a result, overall ad spending growth in the U.S. will accelerate from 3.6% this year to 3.8% in 2013 and then to 4.7% in 2014. But the broadcast networks are headed in the other direction with sales going from -1% in 2012 to -2.5% in 2013 and -3.0% in 2014. The report says that NBC will have a tougher time with the Summer Olympics in London than it had for the Winter Olympics in Vancouver in 2010. With the time difference, “more viewers are expected to tune in online to watch their favourite events rather than wait to watch prerecorded versions.” The shift to cable of college sports including BCS football bowl games and NCAA men’s basketball also has led some advertisers — including pharmaceutical, financial, and consumer products companies — to shift their spending. Those dollars “do not look to be coming back to network TV.” That will contribute to ad growth in cable of 10% this year, then 10.5% and 11% in 2014. ZenithOptimedia still sees pockets of trouble, including at Discovery and Oprah Winfrey’s OWN. The network “has underperformed expectations, and projections of losses for the company are in the region of $330 million…While OWN still has time to recover, the prospects are looking murkier for the cable network.”

Related: TV Leads Ad Spending Uptick In Q1: Study Read More »

Comments (4)

Ad Forecasters Say TV And Digital Will Benefit Most From 2012 Growth: UBS Confab

Three of the most prominent ad-forecasting firms kicked off the UBS Annual Global Media and Communications Conference this morning — as they typically do at this event — by unveiling their updated forecasts for 2012. And they pretty much agree: 2012 will be better than 2011. MagnaGlobal is on the conservative side, projecting 3.2% growth in North America, and GroupM is more bullish at 4%. MagnaGlobal EVP Vincent Letang says that the U.S. ad market will benefit from the strongest-ever quadrennial effect with $2.4B hitting the market from political campaigns, and $600M related to the Summer Olympics in London. That’s why GroupM Futures Director Adam Smith warns that the ad-growth number in 2013 — without the quadrennial effect – ”might be harder to look at.” The forecasters agree that television and digital will benefit most from the growth in ad spending. But they warn that pay TV providers need to watch out: Subscriptions “will go down by 500,000 a year for next five years” partly due to competition from Web video providers such as Netflix, says ZenithOptimedia CEO Steve King, whose company released its forecast last night. He also says that there’s a reason to take the forecasts with a big grain of salt. “The factor that none of us have incorporated is a default” by European country.

Comments (0)

3.5% Ad Sales Growth For Major U.S. Media In 2012, ZenithOptimedia Predicts

The ad firm’s forecast will set an upbeat tone for the Monday kickoff of the UBS Annual Global Media and Communications Conference, the widely watched series of CEO briefings that runs through Wednesday in New York. Zenith’s projected 3.5% growth, to $160.3B, contrasts with +2.2% in 2011. Much of the improvement is attributable to the predicted excitement around the Summer Olympics in London, as well as the recovery of Japan’s economy following the earthquakes and tsunami in March. That will help to drive large financial companies, retailers, and auto makers back into the ad market. Television will be the main beneficiary, with a 5.1% increase to $61.9B. But the Olympics won’t be enough to stop the ad slide at the major broadcast networks (-1% to $16.9B). The problem is the time difference with London: That “will mean fewer events airing live than there were for the Vancouver Olympics,” Zenith says.  It predicts that more viewers will “tune in online to watch their favorite events rather than wait to watch pre-recorded versions.” Syndication will suffer a bigger decline (-12% to $2.2B) as studios struggle to find a daytime host who can match the popularity of Oprah Winfrey. But national cable networks including USA, TBS, and FX will continue to improve (+10% to $20.1B).

In other media: The Internet is still soaring (+16.4% to $30.3B) and will be helped in 2012 by political candidates hoping to reach voters on social media destinations led by Facebook. The Olympics … Read More »

Comments (0)

ABC Done With Upfront Selling

By | Thursday June 9, 2011 @ 9:26am PDT
Nellie Andreeva

ABC joined Fox and the CW in wrapping its upfront sales, the first of the Big 3 to do so. The network wouldn’t comment beyond its official statement, but I hear that in primetime, it landed CPM increases in the 11%-12% range, up from 8%-9% last year. (ABC has the second-highest base CPM behind Fox.) The volume is also up, about 10%, to $2.4 billion-$2.5 billion. The tally does not include sports as well as ABC’s biggest yearly event, the Academy Awards. It’s been a strong upfront selling season for the broadcast networks so far. “It’s a very robust marketplace,” one network insider said. Here is ABC’s statement:

“Buoyed by a strong response from advertisers to a schedule that was equal parts stability and ambition that includes TV’s No. 1 Drama and No. 1 Comedy and many buzz-worthy new additions, ABC has concluded its upfront negotiations, achieving significant increases in pricing. This positive response helped drive great volume across the board, and across all dayparts, and reinforced the confidence that national advertisers have in the power of ABC.”

Comments (0)

CBS Starts To Make Upfront Deals At 14%-15% CPM Increases

By | Friday June 3, 2011 @ 9:13am PDT
Nellie Andreeva

With Fox done with its upfront selling, attention shifted to CBS, which finished No. 1 to Fox in the 18-49 demo and No. 1 in viewers last season. The network had been the most aggressive this upfront season, going into the process with a request for a 18% CPM increase, doubling the increase it got last year. As suspected, there was some gamesmanship involved in the high starting asking price, but it may have helped CBS start writing business at impressive 14%-15% CPM rises. Yesterday, CBS Corp. CEO Leslie Moonves stressed that the network won’t sell at 9% or 10% CPM bumps. (Fox’s CPM increases are in the 10%-11% range.) Industry sources stress that CBS is still early in the selling process with only handful of deals made, but word is they involve a couple of big clients. With ad agencies breaking rank, others may follow. If not, I hear CBS is not going to bring the prices down and plans to wait the buyers out or, if there are not enough takers now, to hold more inventory for the scatter market. Last season, the prices went up from 8%-9% at the upfront to 40% on the scatter market.

Comments (5)