CMR Forecasts Slight Rise in Overall Ad Spending For 2002

Posted on January 22, 2002

Ad spending is expected to rise 1.5 percent in 2002, up to $96.1 billion from an estimated $94.6 billion in 2001, according to the full-year forecast1 released by CMR, a provider of strategic advertising and marketing communications information.

"Looking back on 2001, the advertising industry felt the adverse effects of a souring economy, which took ad spending into the greatest slump we've seen in years," said David Peeler, president and CEO of CMR. "The events of September 11 coupled with the state of our economy certainly accelerated advertising's continued decline for the remainder of the year. As our nation emerges from recession, we believe the worst is behind us and expect to see a slight industry rebound by the onset of the third quarter of 2002."

Overall, 2001 was a lot weaker than many expected. In the banner year of 2000, total ad spending across all media was $104.5 billion, according to CMR. Early estimates by CMR indicate that full-year ad spending for 2001 will be down 9.4 percent to $94.6 billion -- far and away the worst year-over-year showing within the past ten years. "One has to look back to the 1990-1991 recession to find a comparable year-over-year decline in ad spending," noted Peeler.

Looking at the quarter-by-quarter trends, spending will continue to be soft through the first half of the year, although the declines will be much less than those seen in the third and fourth quarters of 2001. The advertising industry expects a modest boost from upcoming major events, such as the Winter Olympics, which is taking place in the first quarter of 2002. CMR expects that the market will begin to rebound beginning with third quarter of 2002. However, this rebound is relative to the depressed levels of the third and fourth quarters of 2001.

2001 VERSUS 2002 QUARTERLY GROWTH TRENDS
TIME PERIOD PERCENTAGE CHANGE
1st Quarter 2001 -4.1%
2nd Quarter 2001 -6.4%
3rd Quarter 2001 -12.1%
4th Quarter 2001 -14.4% (e)
1st Quarter 2002 -5.4% (e)
2nd Quarter 2002 -3.3% (e)
3rd Quarter 2002 3.8% (e)
4th Quarter 2002 10.9% (e)
Source: CMR, a Taylor Nelson Sofres company

(e) = Estimate


CMR predicts spending increases in 2002 for all major media, with Internet advertising leading the way, predicted to grow 8.8 percent from its 2001 total. The upcoming elections in November may drive a stronger increase for local media, especially for spot television and radio advertising. CMR predicts smaller increases for network television (2.0 percent), cable television (1.1 percent) and magazines (0.6 percent).

GROWTH ESTIMATES FOR 2002 BY MEDIA1
MEDIA PERCENT ESTIMATE
NETWORK TV 2.0%
SPOT TV 2.5%
CABLE TV 1.1%
SYNDICATION 1.1%
MAGAZINES 0.6%
NEWSPAPERS 3.1%
OUTDOOR 1.8%
INTERNET 8.8%
Source: CMR, a Taylor Nelson Sofres company


1 Full-year figures and forward-looking estimates are based on CMR's Stradegy(2) multimedia ad expenditure database. CMR measured media include Network Television, Spot Television, Cable Television, Syndication, Magazines, Sunday Magazines, Newspapers, Outdoor, Internet, Spanish Language Network Television, Network Radio and National Spot Radio.

More from The Write News

comments powered by Disqus