‘US Ad Recession is Over’, Analyst Declares

18 March 2002

“The advertising recession is at its end.” That’s the message from Leland Westerfield, media analyst at UBS Warburg, who now believes US adspend will grow this year.

Pointing to new figures from media buyers and sellers, Westerfield predicts a 0.7% increase in advertising expenditure in 2002, up from his earlier forecasts of a 1.6% decline.

Driving the growth will be a 5% rise in spot TV spend (previously expected to climb 3%) and no change in ad buying on network TV (formerly projected to decline 3%). For 2003, he is sticking by his earlier forecast of 4% growth.

“The cyclical recovery appears to be under way sooner than anticipated,” declared Westerfield, noting that eight of the leading ten spot TV advertiser categories upped spend in the first week in March. However, he warned that April and May could still be slow, as many marketers may have shifted spend forward to capitalize on the Winter Olympics.

Westerfield’s upbeat outlook was echoed by fellow Wall Street analyst Jason Helfstein, who noted “an improving advertising environment” in a review of the broadcasting industry for CIBC World Markets. He consequently recommended a number of media stocks, especially those in the radio and outdoor sectors.

Data sourced from: AdAge.com; New York Times; additional content by WARC staff