The German ad industry made a faltering start to the year, according to figures released yesterday by research group AC Nielsen Werbeforschung.

The study shows that January spend in traditional advertising media (TV, print, outdoor, radio) fell by 1.7% from the previous year.

Underlying last month’s downturn are drastic year-on-year cuts in ad investment by telecoms companies and energy groups of 47% and 52% respectively. These sectors were largely responsible for 2000’s 12% boom in billings. However, they were not alone in slashing adspend: compared to January 2000, billings also fell for consumer goods (25%), skincare (20%), brewing (15%) and finance (20%).

This decline was not spread evenly across media. Whereas newspaper and TV ads attracted 6.6% and 3.6% less revenue respectively than in January 2000, ad income both at radio and outdoor jumped at a double-digit rate. Indeed, the rapid growth of radio advertising will probably continue well into the year, according to the medium’s marketing group RMS.

TV companies, however, performed significantly less well than in last year’s boom. Ad revenue fell virtually across the board: 16.2% at ARD, 6.3% at SAT 1, 5.6% at Pro Sieben, 1.3% at RTL and 0.7% at ZDF. Meanwhile, TM3 saw its ad income shrink from DM22.5 million in January 2000 to only DM1.6m last month, blaming its loss of Champions League soccer coverage. Only RTL II bucked the trend, with a 36.4% rise in ad revenue that owed a great deal to its popular Big Brother show.

However, despite the widespread fall in adspend, insiders do not seem to be panicking. In addition to the distortion of last year’s high figures, the reason for much of the decline is, explained Matthias Schwarz of RTL’s marketing arm IP Deutschland, simply that “many customers have decided to launch their advertising campaigns later in the year.”

News Source: Handelsblatt (Germany)