Warc Blog

US adspend up in first quarter

24 June 2014
NEW YORK: Underlying US advertising expenditure grew less than 4% in the first quarter of 2014 compared to a year earlier according to the latest figures from Kantar Media.

The advertising information business reported that total expenditure increased 5.7% to $34.9bn, but once the effect of the Winter Olympics in Sochi was stripped out the growth rate for remaining expenditures was just under 4%.

"The Winter Olympics delivered its expected windfall in the first quarter, adding about $600m of incremental ad spending to the marketplace," said Jon Swallen, chief research officer at Kantar Media North America.

"But the nature of the event is that this money is narrowly distributed and doesn't benefit all sectors of the market," he added.

Television and internet display advertising were the most obvious beneficiaries, with adspend in these media rising 9.7% and 13.0% respectively.

Network TV increased 14.5% with about one-half of this growth coming from the Winter Olympics. Higher spending on the NFL playoffs and Super Bowl also contributed to the gains. One of the biggest increases came in Spanish language TV, which was 18% up, primarily from gains at broadcast networks.

The growth of internet display expenditure, meanwhile, was driven by the increased budgets of financial, retail and insurance marketers, said Kantar. The only other media sector to register any growth was outdoor media, up 2.8% on stronger spending within the local service and retail categories.

Print spending continued its seemingly inexorable decline, with magazines down -1.6% and newspapers down -5.0%. But those figures hid some pockets of optimism. While consumer magazines had been hit by severe reductions from the two largest magazine advertisers (Procter & Gamble and L'Oréal), Kantar Media reported that the number of continuing magazine advertisers which lifted spending had outpaced declines by a 3:2 ratio.

Once again Spanish language magazines bucked the general trend in an impressive fashion, increasing 15.8%, but this did not extend to Spanish language newspapers (up 0.2%) or Hispanic local radio (down 10.8%).

The effect of the Winter Olympics was also evident in the spending figures for the ten largest advertisers, which had risen 14.1% to $4,378.9m, representing an aggregate gain of $540m on the same quarter last year.

Procter & Gamble topped the list with spending of $773.8m, but the greatest increase came at General Motors, whose spending leapt 55.8% to $593.4m and catapulted it into second place in the expenditure rankings.

Data sourced from Business Wire; additional content by Warc staff

 
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