Nielsen: Black-oriented TV tied for second largest category in ad gains for Q1

(June 16, 2008) Advertising spending for the first quarter of 2008 remained essentially flat compared to the same period last year, according to preliminary figures released today by Nielsen Monitor-Plus, the competitive advertising information service of The Nielsen Company.  Advertising was mixed across media with gains in some mediums and declines in others. 

[A detailed analysis of advertising expenditures targeting African-American audiences will be presented by Nielsen at the Marketing to African-American with Excellence (MAAX) Summit on June 30^th.]

Overall despite a continued softening of the economy, several media and companies are showing healthy growth in advertising for this quarter.  Advertising in National Sunday Supplements saw the largest growth, with an increase of 19.2% over Q1 2007, while Local Sunday Supplements fared worst among the 17 media tracked by Nielsen, declining by 13.5% compared with the same period last year.

Q1 2007 vs. Q1 2008
Media Category   % Change

National Sunday Supplement 19.2%
Cable TV   12.9%
African American Television*   12.9%
Network Radio  10.0%
Spanish Language TV*7.7%
Outdoor 2.9%
Syndication TV  2.3%
Spot TV: Top 100   -0.4%
National Magazine  -1.3%
Network TV -3.4%
Spot TV: 101-210   -3.8%
Spot Radio -4.9%
FSI Coupon -4.9%
Local Newspaper-5.4%
National Newspaper -6.2%
B-to-B -6.1%
Local Sunday Supplements  -13.5%
Total Advertising Spending  0.5%

Source: Nielsen Monitor-Plus (Jan.-March 2007 and Jan.-March 2008) * African American Television includes broadcast network, cable, and syndication programs with an African American audience composition of 50% or greater, BET, and TV One. * Spanish Language Television includes broadcast, cable, and station
coverage.

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 grew by 14.7% in the first quarter of  2008 over the same period in 2007. Sponsored search link advertising drove overall growth, and rich media led growth in the display category.  Among online advertisers, the health and telecommunications industries posted strong increases in sponsored search link 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, who 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.  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%).

2008Q1 2008   Q1 2007
Rank   Top 10 Product Categories($ mil)   ($ mil) % change

1  Automotive  $2,695.8  $2,940.6   -8.32%
2  Pharmaceutical  $1,311.7  $1,310.00.13%
3  Auto Dealerships$1,113.7  $1,109.50.38%
4  Restaurant-Quick Service$1,028.3$985.24.36%
5  Telephone Services-Wireless   $971.9$975.7   -0.38%
6  Motion Picture$957.3$968.4   -1.14%
7  Department Store  $717.4$720.6   -0.44%
8  Direct Response Product   $670.2$577.4   16.07%
9  Credit Card Services  $473.0$437.08.23%
10 Financial-Investment Services $455.0$419.28.53%
Total: Top 10 Product Categories  $10,394.8 $10,444.1   -0.47%

Source: Nielsen Monitor-Plus (Jan.-March 2007 & Jan.-March 2008)

The Direct Respond 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 for the first quarter 2008 reached just over $4 billion-up slightly (+1.2%) from $3.96 billion during the same time period in 2007.  Half of the top 10 advertisers increased their budgets from Q1 2007 to the first quarter of this year, while the other half showed decreases.

2008   Q1 2008  Q1 2007
Rank   Top 10 Parent Companies ($ mil)  ($ mil) % change

1  Procter & Gamble Co. $902.8   $755.0   19.57%
2  General Motors Corp. $536.5   $493.08.81%
3  AT&T Inc.$465.7   $555.4  -16.15%
4  Verizon Communications Inc.  $401.4   $399.60.43%
5  PepsiCo Inc. $354.8   $253.6   39.86%
6  Toyota Motor Corp.   $350.4   $293.7   19.30%
7  Ford Motor Co.   $330.2   $446.3  -26.00%
8  Time Warner Inc. $323.7   $350.9   -7.75%
9  Johnson & Johnson$316.0   $354.0  -10.72%
10 Walt Disney Co.  $299.9   $332.0   -9.67%
Total: Top 10 Parent Companies$4,281.8 $4,234.11.13%

Source: Nielsen Monitor-Plus (Jan.-March 2007 & Jan.-March 2008)

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.  Ad 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, like the Focus, from Q1 2007 to Q1 2008.


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