NEW YORK – Total advertising expenditures in the first quarter of 2013 declined 0.1 percent from a year ago and finished the period at $30.2 billion, according to data released by Kantar Media, the leading provider of strategic advertising and marketing information.
“It has been a lackluster start for 2013, with flat year-over-year results due in part to strong 2012 growth caused by political and Olympic ad spending”
“It has been a lackluster start for 2013, with flat year-over-year results due in part to strong 2012 growth caused by political and Olympic ad spending,” said Jon Swallen, Chief Research Officer at Kantar Media North America. “Data from the early second quarter are mixed, suggesting marketers are still being cautious and conservative with ad budgets. However, there are some bright spots, including healthy growth for Hispanic media and Outdoor.”
Measured Ad Spending By Media
Television media turned in mixed performances. Cable TV expenditures rose 5.2 percent, aided by an increase in the volume of ad time and by stronger demand from restaurants and auto manufacturers. Spanish Language TV spending increased 13.5 percent, its seventh consecutive quarter of double digit growth – a strong result although lower than 15 percent annual growth rate seen in 2012. The Spanish Language segment continues to be driven by gains among national broadcast networks.
Weaker prime time ratings contributed to a 5.2 percent decline in Network TV spending. Comparisons were also hurt by a calendar timing shift that moved ad money for NCAA Final Four games out of Q1 and into April. Apart from this anomaly, sports programming produced ad revenue gains for broadcast networks.
Spot TV expenditures were down 2.4 percent, but if cyclical political advertising is excluded, the medium was roughly flat versus last year. Spending in Syndication TV declined 1.1 percent.
Among print media, Consumer Magazines benefitted from higher spending by leading CPG advertisers and saw total expenditures increase 1.8 percent in the first quarter. Sunday Magazines were down 3.7 percent mainly due to cutbacks from prescription drug marketers. Local Newspaper ad spending fell 3.3 percent and National Newspapers decreased 9.2 percent, each hurt by substantial reductions from the financial services and motion picture categories. The losses in Newspaper spending were consistent with reductions in the amount of space sold.
Outdoor advertising investments rose 4.3 percent, the eleventh consecutive quarter of year-over-year increases. Higher spending from Local Services, Retail and Restaurants were a prime catalyst.
Internet display ad spend has not been included for Q1 due to measurement changes. It will return for Q2 reporting.
| Percent Change in Measured Ad Spending1 | ||||
| MEDIA SECTOR | Jan – Mar | |||
| • Media Type | 2013 vs. 2012 | |||
| (Sectors and types listed in rank order of spending) | ||||
| TELEVISION MEDIA | 0.3% | |||
| • Cable TV2 | 5.2% | |||
| • Network TV | -5.2% | |||
| • Spot TV3 | -2.4% | |||
| • Spanish Language TV4 | 13.5% | |||
| • Syndication – National | -1.1% | |||
| MAGAZINE MEDIA5 | 0.6% | |||
| • Consumer Magazines | 1.8% | |||
| • B-to-B Magazines | -4.1% | |||
| • Sunday Magazines | -3.7% | |||
| • Local Magazines | -5.7% | |||
| • Hispanic Magazines | 12.0% | |||
| NEWSPAPER MEDIA6 | -4.0% | |||
| • Local Newspapers | -3.3% | |||
| • National Newspapers | -9.2% | |||
| • Hispanic Newspapers | 1.4% | |||
| RADIO MEDIA | -1.7% | |||
| • Local Radio7 | -1.0% | |||
| • National Spot Radio | 5.7% | |||
| • Network Radio | -15.2% | |||
| OUTDOOR | 4.3% | |||
| FSIs8 | 3.8% | |||
| TOTAL | -0.1% | |||
| Source: Kantar Media | |
| 1. | Figures are based on the Kantar Media Stradegy™ multimedia ad expenditure database across all measured media, including: Network TV (5 networks); Spot TV (125 DMAs); Cable TV (total of 77 networks); Syndication TV; Hispanic Network TV (4 networks); Consumer Magazines (192 publications);Sunday Magazines (8 publications); Local Magazines (31 publications); Hispanic Magazines (18 publications); Business-to-Business Magazines (352 publications); Local Newspapers (133 publications); National Newspapers (3 publications); Hispanic Newspapers (47 publications); Network Radio (5 networks); National Spot Radio (205 markets); Local Radio (36 markets); and Outdoor. Figures do not include public service announcements (PSA) or house advertising |
| 2. | Cable TV figures are based on 73 English language networks and do not include any Hispanic cable networks |
| 3. | Spot TV figures are based on 665 English language stations in 125 DMAs and do not include any Hispanic stations |
| 4. | Spanish Language TV includes 4 Hispanic broadcast networks, 4 Hispanic cable network and 76 local Hispanic TV stations |
| 5. | Magazine media includes Publishers Information Bureau (PIB) data and reflect print editions of publications |
| 6. | Newspaper media figures reflect print editions of publications |
| 7. | Local Radio reflects expenditures for 36 markets in the U.S. and the data are provided by Miller, Kaplan, Arase & Co |
| 8. | FSI data represents distribution costs only |
Measured Ad Spending By Advertiser
Spending among the ten largest advertisers in the opening quarter of 2013 was $3,735.0 million, a 5.7 percent increase compared to a year ago. Among the Top 100 marketers, a diversified group accounting for roughly two-fifths of all measured ad expenditures, budgets climbed 0.5 percent.
Procter & Gamble was the top-ranked advertiser with spending of $722.5 million, up 9.1 percent. P&G operates on a July-June fiscal calendar and the March quarter increase only cancels out lower spending from earlier in the fiscal year. The only other CPG company in the Top Ten rankings was L’Oreal, which spent $394.6 million on media advertising in the period, up 25.2 percent. The company raised marketing support for its L’Oreal Paris line of cosmetics and hair care products.
AT&T expenditures rose 27.5 percent, to $463.5 million, the largest rate of increase among Top Ten marketers. The company directed more money to local media, supporting an ongoing market expansion of its U-Verse broadband and video service. In contrast, ad spending at rival Verizon Communications fell 4.0 percent to $295.9 million.
The largest decline among the Top Ten was posted by Comcast, which reduced expenditures by 17.5 percent to $331.2 million. The cutbacks were concentrated in its movie studios, which had fewer major releases compared to the prior year.
Two automotive advertisers landed in the Top Ten. Spending by Ford Motor rose 12.9 percent to $280.3 million, propelled by big marketing launches for redesigned versions of the Escape and Fusion models.
Meanwhile, General Motors trimmed its spending by 2.6 percent to $362.9 million.
| Top Ten Advertisers of Q1 20131 | |||||||||||||||
| Rank | Company | Jan-Mar 2013 ($ Millions) |
Jan-Mar 2012 ($ Millions) |
% Change | |||||||||||
| 1 | Procter & Gamble Co | $722.5 | $662.1 | 9.1% | |||||||||||
| 2 | AT&T Inc | $463.5 | $363.7 | 27.5% | |||||||||||
| 3 | L’Oreal Sa | $394.6 | $315.3 | 25.2% | |||||||||||
| 4 | Comcast Corp | $331.2 | $401.3 | -17.5% | |||||||||||
| 5 | General Motors Corp | $362.9 | $372.5 | -2.6% | |||||||||||
| 6 | News Corp | $340.1 | $345.6 | -1.6% | |||||||||||
| 7 | Verizon Communications Inc | $295.9 | $308.2 | -4.0% | |||||||||||
| 8 | Ford Motor Co | $280.3 | $248.3 | 12.9% | |||||||||||
| 9 | Time Warner Inc | $286.9 | $282.5 | 1.6% | |||||||||||
| 10 | Berkshire Hathaway Inc | $257.0 | $234.5 | 9.6% | |||||||||||
| TOTAL2 | $3,735.0 | $3,534.0 | 5.7% | ||||||||||||
| Source: Kantar Media | |
| 1. | Figures do not include Internet advertising, FSIs, House Ads, or PSA activity |
| 2. | The sum of the individual companies can differ from the total shown due to rounding |
Measured Spending By Size of Advertiser
The Top Ten advertisers are a fraction of all spending and are an incomplete indicator of broader trends. Ranking and grouping companies into tiers provides deeper insights into how different segments of advertisers are behaving and where growth is occurring.
Building out to the Top 100 advertisers, first quarter expenditures increased just 0.5 percent and barely out-performed the overall average. Growth was strongest at mid-size marketers outside the Top 100, a recurring pattern in the past few years. Among the tier of companies ranked 101-250, spending increased 6.3 percent and accounted for about a 16 percent share of the total marketplace. Right behind was the tier of companies ranked 251-1,000 with an increase of 4.6 percent.
Small advertisers, defined as those beyond the Top 1,000, significantly lagged the market with aggregate expenditures declining 9.2 percent in the period. This tier accounted for about one-fifth of total ad spending. Historically, media spending within this segment has been more variable and sensitive to the economic climate.
| Q1 2013 Spending By Size of Advertiser1 | |||||||||||||
| Segment | Company Spending Rank |
% Change vs.Q1 2012 | % Share of Q1 2013 Spend
|
||||||||||
| GRAND TOTAL | -0.1% | 100.0% | |||||||||||
| Large Advertisers | Top 100 | 0.5% | 46.3% | ||||||||||
| Mid-Size Advertisers |
Rank 101-250 | 6.3% | 16.2% | ||||||||||
| Rank 251-1,000 | 4.6% | 16.6% | |||||||||||
| Small Advertisers | Rank 1001+ | -9.2% | 20.9% | ||||||||||
| Source: Kantar Media | |
| 1. | Figures do not include Internet Display or FSI spending |
Measured Ad Spending By Category
Expenditures for the ten largest categories grew 1.3 percent in the first quarter of 2013 to $19,591.5 million.
Automotive was the top category with $3,351.8 million of spending, down 0.5 percent. Manufacturer budgets fell 3.3 percent primarily because there were fewer marketing launches in 2013 to provide impetus for higher budget levels. Dealer spending remained active with a gain of 3.7 percent amidst a strong retail sales climate.
Retail was the second largest category by dollar volume with media expenditures of $3,168.6 million, up 0.5 percent. Results varied widely among narrower competitive segments. On the positive side, expanded campaigns from Target, Walmart and Sears lifted total spending by department stores. However, less favorable weather conditions compared to a year ago resulted in a delayed spring selling season and forced home improvement retailers to defer some ad spending that had been planned for late Q1.
Telecom posted the largest growth rate among the Top Ten categories, a 10.1 percent increase to $2,066.5 million. Aggressive spending hikes from AT&T, Sprint Nextel and Samsung accounted for a majority of the growth while aggregated spending from TV service providers eased slightly.
Expenditures for Personal Care Products increased 9.0 percent to $1,583.7 million as competition among leading cosmetic and hair care brands continues to drive the category. Spending by Restaurants was up 8.0 percent to $1,621.9 million in the period. With industry sales and customer traffic turning sluggish, many leading brands tactically increased ad budgets in response.
Financial Services advertising remained soft during the quarter and declined 4.2 percent to $1,679.3 million. Broad reductions among credit card issuers, retail banks and retirement planning services outweighed higher spending from tax preparation firms.
Expenditures from the Direct Response category fell 11.0 percent to $1,368.6 million, principally due to reduced clearances on cable TV networks.
| Top Ten Advertising Categories of Q1 20131 | |||||||||||||||
| Rank | Category | Jan-Mar 2013 ($ Millions) |
Jan-Mar 2012 ($ Millions) |
% Change | |||||||||||
| 1 | Automotive | $3,351.8 | $3,369.2 | -0.5% | |||||||||||
|
$1,970.5 | $2,037.3 | -3.3% | ||||||||||||
|
$1,381.4 | $1,331.8 | 3.7% | ||||||||||||
| 2 | Retail | $3,168.6 | $3,151.7 | 0.5% | |||||||||||
| 3 | Telecom | $2,066.5 | $1,876.9 | 10.1% | |||||||||||
| 4 | Local Services | $2,045.1 | $2,002.4 | 2.1% | |||||||||||
| 5 | Financial Services | $1,679.3 | $1,752.4 | -4.2% | |||||||||||
| 6 | Restaurants | $1,621.9 | $1,502.0 | 8.0% | |||||||||||
| 7 | Food & Candy | $1,585.8 | $1,615.2 | -1.8% | |||||||||||
| 8 | Personal Care Products | $1,583.7 | $1,452.9 | 9.0% | |||||||||||
| 9 | Direct Response | $1,368.6 | $1,537.1 | -11.0% | |||||||||||
| 10 | Insurance | $1,120.0 | $1,071.1 | 4.6% | |||||||||||
| TOTAL2 | $19,591.5 | $19,330.7 | 1.3% | ||||||||||||
| Source: Kantar Media | |
| 1. | Figures do not include Internet advertising, FSI or PSA activity |
| 2. | The sum of the individual categories can differ from the total shown due to rounding |
About Kantar Media
Kantar Media provides critical information that helps our clients make better decisions about communications. We enable the world’s leading brands, publishers, agencies and industry bodies to navigate and succeed in a rapidly evolving media industry. Our services include analysis of paid media opportunities; counsel on brand reputation, corporate management and consumer engagement through owned media; and evaluating consumers’ reactions in earned media. As the global house of expertise in media and marketing information, Kantar Media provides clients with a broad range of insights, from audience research, competitive intelligence, vital consumer behaviour and digital insights, to marketing effectiveness and social media monitoring. Our experts currently work with 22,000 companies tracking 4 million brands in 50 countries. For further information, please visit us at www.kantarmediana.com
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