US Advertising Spending Flat in First Quarter

June 17, 2008

This article is included in these additional categories:

Automotive | Financial Services | Magazines | Newspapers | Out-of-Home | Radio | Television

Advertising spending for the first quarter of 2008 remained essentially flat compared with the same period last year, with gains in ad spend for some media and declines for others, according to preliminary figures released by Nielsen Monitor-Plus.

Despite a continued softening of the economy, several media and companies showed healthy first-quarter advertising growth.


Among the growth data issued for the 17 media tracked by Nielsen:

  • Advertising in national Sunday supplements recorded the largest growth, with an increase of 19.2% over Q1 2007.
  • Local Sunday supplements fared worst, declining 13.5% compared with the same period last year.
  • Cable TV (+12.9%), network radio (+10%), outdoor (+2.9%) enjoyed healthy advertising growth in Q1 2008, compared with Q1 2007.
  • In television, programming and networks targeting African American and Hispanic viewers grew 12.9% and 7.7%, respectively.
  • Internet advertising impressions increased 14.7% in first quarter 2008 over the same period in 2007.
  • Sponsored search link advertising drove overall growth, and rich media led the increase in the display category.
  • Among online advertisers, the health and telecommunications industries posted strong increases in sponsored-search impressions, up 108% and 80%, respectively.
  • Hardware and electronics advertisers drove results in display impressions with 65% growth, followed by automotive and consumer goods companies, which posted increases of 45% and 42%, respectively.
  • Financial services companies, historically among the largest online advertisers, decreased investment during the period in both sponsored search impressions, down 15%, and display impressions, down 13%.

Category Spending

Spending for the 10 largest advertising categories reached just over $10 billion in the first quarter of this year, 0.47% less than the same period last year, Nielsen said.


  • Most product categories showed increased spending, with the exception of automotive (-8.32%), motion picture (-1.14%), department store (-0.44%), and telephone services-wireless (-0.38%).
  • The direct-response product category had the largest percentage increase in advertising spending, at just over 16%.
  • At the other end of the spectrum, the automotive category, though it remained the top category spender, showed the largest percentage decrease (-8.32%) from the same period last year.

Advertiser Spending

Advertising spending by the top 10 companies in the first quarter of 2008 reached just over $4 billion – up slightly (+1.2%) from $3.96 billion in the year-earlier period in 2007, Nielsen said.

Half of the top 10 advertisers increased their budgets from Q1 2007 to the first quarter of this year, while the other half decreased budgets, according to the data.


Among the highlights:

  • PepsiCo Inc., which increased ad spending from $253 million in the first quarter of 2007 to $354 million in Q1 2008, had the largest percentage increase (+39%). The company showed especially significant increases in advertising expenditures for its beverages, including APM, Pepsi Max, G2, Gatorade (including the release of Gatorade Tiger), Propel water, and Sobe Life Water.
  • Procter & Gamble, the quarter’s largest advertiser, also increased ad spending significantly (+20%). P&G’s Olay, Gillette, Cover Girl, Crest, and Dawn product lines all showed significant growth in ad expenditures. Spending for P&G’s osteoporosis drug, Actonel, also increased.
  • At the other end of the spectrum, Ford Motor Co., which cut its advertising budget from approximately $446 million in Q1 2007 to $330 million in the first quarter of this year, showed the largest percentage decrease in ad spend (-26%). Although Ford significantly cut advertising expenditures for larger trucks, SUVs, and cars, such as the Ford F-Series, Expedition, Land Rover, Cadillac, it actually increased ad spending for small cars, such as the Focus, from Q1 2007 to Q1 2008.

Explore More Articles.

Marketing Charts Logo

Stay on the cutting edge of marketing.

Sign up for our free newsletter.

You have Successfully Subscribed!

Pin It on Pinterest

Share This