Good News for Ad Industry, and for MR

Three new reports give varying degrees of encouragement to the advertising industry. Nielsen Media Research highlights healthy growth in the US, and the UK's Advertising Association forecasts long-term growth in display, while ZenithOptimedia's global projections offer most optimism for the Internet... and for market researchers.

Preliminary figures from Nielsen Media Research say US ad spending is up 4.5% in Q3 of 2005 vs the same quarter in 2004. Spend increased in almost all reported media, led by Internet, Spanish-Language TV and Cable TV, but with healthy gains also for Local Magazines. Media showing slower growth or staying flat were Spot TV in the smaller markets, Local Newspapers, Network Radio and Coupons. Network TV appears healthy but last year's Q3 figures were boosted by the Olympics, resulting in a decline this year according to Jeff King, MD of the company's advertising intelligence service Nielsen Monitor-Plus.

Spend by the top 10 companies in Q3 topped $14 billion, up 1.8% from last year. Automotive companies spent 2.9% more ($5.4 billion) despite DaimlerChrysler cutting back 5.6%. Most product categories have increased spending, with the exception of Local Automotive Dealerships and Department Stores, which are each slightly down. The Restaurant industry grew fastest in percentage terms.

Nielsen's Product Placement tracking service continues to show significant growth in the integration of product occurrences in primetime broadcast network programming with 12,445 occurrences for the top 10 brands in Q3. The program The Contender, currently off-air, featured more than twice the number of product placements of second-placed American Idol (7,514 vs 3,497).


UK display ad spend has a bright future according to the latest Long Term Advertising Expenditure Forecast from the UK Advertising Association. The report, compiled by the World Advertising Research Center (WARC), makes predictions a dozen years into the future and expects a recovery in spend in 2006 after a cooling off year this year, to a peak in 2009.

Table: High and Low Twelve Year Forecast Options
(£m at constant 2000 prices)

Note: Media covered by the report include television, national newspapers, regional newspapers, consumer magazines, business magazines, directories, radio, outdoor & transport, cinema, the internet and direct mail.

The report says the underlying economic forces that drive ad spend are 'likely to continue to be positive into the foreseeable future' although within this, individual media will be affected by specific trends.


The fracturing advertising market caused by the diversification of media is good news for market researchers, according to a report by ZenithOptimedia covered in the FT. Zenith says global spending on market research - now $23bn - will grow more than 11% this year and in each of the following two years, reflecting companies' need to measure the impact of advertising through newly crucial channels, in particular the Internet.

According to CEO Steve King, 'You can spend a lot of money and reach nobody... Companies are experimenting more because they believe they can no longer rely on traditional television advertising alone to reach the mass market. You need a much more dynamic research structure to reflect rapidly changing media consumption patterns, particularly among upscale and younger audiences'.

The prediction is part of Zenith's annual advertising forecast, the headlines of which say that global ad spending will grow 4.8% in 2005, and between 5.7% and 6.0% in each of the next three years, reaching c.$479bn in 2008 from $403.7bn in 2005. The expected rise reflects the growth of advertising markets in emerging economies such as China, Russia, India and Brazil, as well as rapid growth in Internet ad spend from a global total of $14bn last year (4.6% of all ad spend) to nearly $30bn (6.4%) in 2008.

Nielsen Media Research is online at www.NielsenMedia.com , WARC at www.warc.com and ZenithOptimedia at www.ZenithOptimedia.com.

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.

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