Media Life
Forecast: National and local will see greater increases
July 16, 2013
The year hasn’t gotten off to a great start for advertising. Spending was up just 0.3 percent during the first half of the year.
But the pace will pick up, if modestly, in the second half, and if the U.S. economy continues to improve, gains will be much higher over the next three years.
A forecast from Pivotal Research Group predicts that ad spending in the final two quarters of this year will rise by 0.7 percent, driven by gains in national spending.
“The economy has to generally improve year over year at a faster pace in the second half than in the first half, which seems generally likely,” Brian Wieser, senior research analyst at Pivotal, tells Media Life.
National ad spending will be up 2.8 percent in third quarter and 2.7 percent in fourth, compared to gains of 2.2 percent and 2.3 percent to start the year.
Those increases will be driven by digital, the only category to see double-digit bumps, and television, still by far the largest dollar category.
Together they will account for more than $53.6 billion in spending in 2013, or 79 percent of all national ad dollars.
Local will struggle by comparison, hurt by continued declines in newspaper advertising, which will be down at least 8.7 percent each quarter.
Local ad spending will decline 1.3 percent in third quarter and 1.4 percent in fourth.
That’s in improvement over the first half, when spending slipped by 1.8 percent as advertisers held back on increasing their spending, waiting to see how the sequester and payroll tax increase would impact potential customers.
But instead of declining, consumer spending has actually risen throughout the first half of the year. The government measures didn’t seem to scare people into closing their purses.
The U.S. Department of Commerce released numbers Monday showing that total retail and food service sales in June, including gasoline stations, were up 0.4 percent month to month and 5.7 percent year to year.
Recent improvements in the housing market, with new home sales up to their highest level since the recession hit in 2008, and unemployment, with the U.S. adding an average 200,000 jobs per month over the past six months, have boosted overall confidence in the economy.
But there’s usually a lag period between when those improvements are seen and when local advertisers start to feel secure enough to increase their spending.
Overall, 2013 will be a year of moderate spending increases, due also in part to the tough comparisons to Olympic and political spending last year.
In 2014 through 2017, the gains will be more substantial. Ad spending will be up 2.5 percent in 2014, Pivotal predicts, 2.6 percent in 2015, 2.8 percent in 2016 (the next presidential election year), and 3 percent in 2017.
A forecast from Pivotal Research Group predicts that ad spending in the final two quarters of this year will rise by 0.7 percent, driven by gains in national spending.
“The economy has to generally improve year over year at a faster pace in the second half than in the first half, which seems generally likely,” Brian Wieser, senior research analyst at Pivotal, tells Media Life.
National ad spending will be up 2.8 percent in third quarter and 2.7 percent in fourth, compared to gains of 2.2 percent and 2.3 percent to start the year.
Those increases will be driven by digital, the only category to see double-digit bumps, and television, still by far the largest dollar category.
Together they will account for more than $53.6 billion in spending in 2013, or 79 percent of all national ad dollars.
Local will struggle by comparison, hurt by continued declines in newspaper advertising, which will be down at least 8.7 percent each quarter.
Local ad spending will decline 1.3 percent in third quarter and 1.4 percent in fourth.
That’s in improvement over the first half, when spending slipped by 1.8 percent as advertisers held back on increasing their spending, waiting to see how the sequester and payroll tax increase would impact potential customers.
But instead of declining, consumer spending has actually risen throughout the first half of the year. The government measures didn’t seem to scare people into closing their purses.
The U.S. Department of Commerce released numbers Monday showing that total retail and food service sales in June, including gasoline stations, were up 0.4 percent month to month and 5.7 percent year to year.
Recent improvements in the housing market, with new home sales up to their highest level since the recession hit in 2008, and unemployment, with the U.S. adding an average 200,000 jobs per month over the past six months, have boosted overall confidence in the economy.
But there’s usually a lag period between when those improvements are seen and when local advertisers start to feel secure enough to increase their spending.
Overall, 2013 will be a year of moderate spending increases, due also in part to the tough comparisons to Olympic and political spending last year.
In 2014 through 2017, the gains will be more substantial. Ad spending will be up 2.5 percent in 2014, Pivotal predicts, 2.6 percent in 2015, 2.8 percent in 2016 (the next presidential election year), and 3 percent in 2017.
No comments:
Post a Comment