U.S. advertising spend increases slightly in 2011

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U.S. advertising spending increased 0.8% to $144 billion in 2011 compared with the previous year, said Jon Swallen, SVP of research at consultancy and research firm Kantar Media. Despite this slight bump, advertising spend in Q4 2011 dropped 1% from the same period one year ago, according to Kantar's data. The decrease represents the first quarterly decline since the end of 2009, which was the point at which advertising revenues began to recover from the recession.

However, it was the Q4 decline that most impressed Swallen. “If you think of the three formats of advertising — video, text, audio — then the major story is the Q4 resilience of video versus the Q4 deterioration of text and audio,” he said.

Overall, growth in text and audio-based media was either stagnant or flat. While Kantar Media did not give ad spend revenues by media sector, internet media, consisting of paid search and display ads, grew 0.4% during 2011; during Q4 2011, internet media declined 6.2% compared to the same period the year previous. Spend on paid search ads, in particular, declined 6.4% in Q4, finishing the year with a 2.8% decline. Kantar Media had no comment on the reason for this decline. However, there have been instances where simpler, targeted offers had better ROI than paid search ads.

Magazine and newspaper ads also declined during 2011 (0.4% and 3.7% respectively). Magazine ad spend decreased 4.9% in Q4 compared to the same period in 2010; newspaper ad spend decreased 3.7%, mirroring its full year 2011 dip. Kantar Media predicted these fourth quarter falls were due to the reallocation of resources as brands shifted their budgets to accommodate ad spend in other channels, notably television.

Kantar Media noted television media increased 3.1% during Q4 2011 compared to the same period in 2010. This growth is similar to the full year increase of 2.7%. Significant growth areas over full year 2011 include spend in cable TV (7.7%), nationally-syndicated ads (15.4%) and Spanish-language TV (8.3%). By contrast, network TV ad spend declined 2% over 2011, a “one-time shift” Swallen attributes to the roughly $500 million of sports ad spending migrating from network to cable outlets.

However, Spanish-language ads in both text and video mediums saw significant growth. Ads on Spanish-language television grew 8.3% in full year 2011, and 19.1% in Q4 compared to the same period in 2010. Spending in Spanish-language magazine ads increased 24.9% in full year 2011, and grew 25.1% in Q4 2011 compared to Q4 2010. Spanish-language newspaper ads, which grew a comparatively paltry 1.9% in full year 2011, surged 10.4% in Q4 2011 compared to the same period in 2010.

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