TV, Net, Outdoor Drive 2010 Ad Expenditure Rise

March 21, 2011

kantar-measured-ad-spending-2010-mar-2011.JPGTotal US advertising expenditures increased 6.5% in 2010 and finished the year at $131.1 billion, according to data released by Kantar Media. Solid increases in ad expenditures in the TV, internet and outdoor sectors helped offset smaller increases in the radio, FSI and magazine sectors and negative growth in the newspaper sector.

Spot TV Leads the Way

The TV sector reported the best year-over-year ad expenditure growth rate in 2010 (10.3%). Within the sector, extremely strong spot TV growth (24.2%) helped spur overall growth and also cushioned the effect of a 2.8% contraction in national syndicated TV ad expenditures.
Within other sectors, standout performers included national spot radio (18.6% increase) and Spanish language magazines (5.5%). Poor performance in local newspapers (4.6% decrease) negated small growth in other newspaper subsectors and led to overall contraction in the sector’s ad expenditure growth.

Top 10 Advertisers Increase Expenditures 4%

kantar-top-advertisers-2010-mar-2011.JPGSpending among the 10 largest advertisers in the US market during 2010 reached about $16.3 billion, a 3.7% increase compared to almost $15.8 billion the prior year. Among the Top 100 marketers, a diversified group accounting for close to one-half of all measured ad expenditures, investments climbed 8.8%.

For the eighth consecutive year, Procter & Gamble was the top advertiser with spending of about $3.1 billion, up 17.7% compared to 2009.
L’Oreal posted the largest rate of increase among the Top 10 with expenditures soaring 30.6% to about $1.1 billion The company boosted marketing support broadly across its portfolio of mass market and prestige cosmetics brands.

Among auto manufacturers, Ford Motor upped its total ad budgets by 11.1% to about $11 billion, while its rival General Motors reduced spending slightly, down 1.3% to about $2.1 billion For both companies, exceptionally high levels of ad support in Q4 2009 timed to the leading edge of the auto sales rebound made for difficult comparisons in Q4 2010 and pulled down the full-year growth rates.

AT&T raised expenditures by 12.1%, to almost $2.1 billion as it continued to expand marketing efforts for its residential and mobile TV services. Verizon Communications trimmed ad spending 15.2% to about $1.8 billion.

Significant reductions were seen in the ad budgets of Pfizer (down 11.7% to roughly $1.2 billion) and Johnson & Johnson (down 7.5% to about $1.1 billion).

Automotive Drives Increase in Top Categories

kantar-top-ad-categories-2010-mar-2011.JPGExpenditures for the ten largest advertising categories increased 6.5% year-over-year in 2010, from almost $69.6 billion to $74.1 billion. Automotive was the leading category in both dollar volume and growth rate, finishing 2010 at $13 billion, up 19.8%. Category spending grew almost twice as fast as new vehicle sales (19.8% compared to 11.1%), reflecting what Kantar calls a fiercely competitive marketing environment for manufacturers and dealers.

Telecom was the second largest category with 2010 budgets rising a modest 4% to about $8.7 billion. Lower spending by wireless carriers and satellite TV companies was offset by higher outlays from cable TV service providers.

Ad spending for financial services increased 6% to about $7.7 billion In the aftermath of the financial crisis, Kantar analysis shows marketing activity has picked up noticeably for products related to debt (credit cards, consumer loans) while advertising budgets for savings related segments have lagged (investments, retail banking).

Only two of the top 10 categories experienced year-over-year declines. Direct response budgets fell by 5.8% to about $6.1 billion, while pharmaceutical expenditures dropped 8.2% to $4.3 billion, the lowest dollar amount tracked by Kantar for this category since 2003.

Branded Entertainment Consumes 36% of Prime Time Hourly Content

kantar-brand-appearances-2010-mar-2011.JPGDuring Q4 2010, Kantar data indicates an average hour of monitored US prime time network programming contained six minutes, fifty seven seconds (6:57) of in-show brand appearances and 14:50 of network commercial messages. The combined total of 21:47 of marketing content represents 36% of a prime time hour.

Unscripted reality programming had an average of 14:19 per hour of brand appearances, as compared to just 4:50 per hour for scripted programs such as sitcoms and dramas. Late night network talk shows had an average of 10:31 per hour. The combined load of brand appearances and network ad messages in these late night shows was 25:22 per hour, or 42% of total content time.

GreenLight: Oscar Celeb Endorsements Jump 500%

Nearly one in four ads shown during the February 27, 2011 Academy Awards (Oscar) broadcast featured a celebrity endorsement, according to the Ad Gauge from media licensing company GreenLight. This represents a 500% increase in endorsement ads from the 2010 broadcast, when less than 5% featured celebrity endorsements.

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