Ad Spending Continues to Fall

Posted on September 5, 2001

Advertising spending for all media fell 5.9 percent for the first half of 2001 compared to first-half revenues in 2000, according to the latest figures from CMR, a provider of strategic advertising and marketing communication information. CMR estimates that total ad spending for the first half of 2001 came in at just under $47.5 billion, compared to $50.4 billion for the same timeframe in 2000.

Print media saw a significant drop-off in revenue for the first half of the year, with magazines down 4.5 percent and daily and Sunday newspapers down 6.6 and 10.4 percent respectively. Network and Spot television continue to be impacted by the economic downtown, with declines of approximately 2 and 15 percent respectively, compared to the first half of 2000. Syndicated and cable television were the bright spots, showing gains of 5.1 and 4.6 percent respectively.

``Second quarter results are not much of a surprise. After we saw ad spending drop 5 percent during the first quarter, we certainly did not expect an upswing during the second quarter,'' said David Peeler, president and CEO of CMR. ``With the economy not showing near-term signs of rebounding, advertising will continue to fall victim to budget cuts within Corporate America. Until the overall economy experiences a turn for the better, we cannot anticipate a positive change for the advertising landscape this year.''

Ad Spending By Media:
First Half 2000 Vs. 2001
MEDIA JAN-JUNE 2000 JAN-JUNE 2001 % CHANGE
(Millions) (Millions)
NETWORK TV $10,678 $10,430 -2.3%
MAGAZINES $8,480 $8,100 -4.5%
SPOT TV $8,417 $7,176 -14.7%
CABLE TV $5,278 $5,521 4.6%
SUNDAY NEWSPAPERS $5,355 $4,800 -10.4%
DAILY NEWSPAPERS $4,352 $4,065 -6.6%
SYNDICATION-NATIONAL $1,539 $1,618 5.1%
NATIONAL NEWSPAPERS $1,604 $1,589 -1.0%
OUTDOOR $1,184 $1,220 3.1%
NATIONAL SPOT RADIO $1,323 $1,027 -22.4%
SUNDAY MAGAZINES $531 $539 1.5%
NETWORK RADIO $466 $408 -12.5%
Source: CMR, a Taylor Nelson Sofres company


TOP TEN AD SPENDERS:
FIRST HALF 2000 VS 2001
COMPANY JAN-JUNE 2000 JAN-JUNE 2001 % CHANGE
(Millions) (Millions)
GENERAL MOTORS CORP $1,441 $1,102 -23.5%
PHILIP MORRIS $1,031 $863 -16.3%
AOL TIME WARNER $602 $734 21.9%
DAIMLERCHRYSLER $783 $715 -8.7%
PROCTER & GAMBLE $708 $688 -2.8
FORD MOTOR CO $647 $652 0.8%
WALT DISNEY CO $529 $489 -7.6%
JOHNSON & JOHNSON $471 $479 1.7%
PEPSICO INC $425 $418 -1.6%
PFIZER INC $412 $405 -1.7%
Source: CMR, a Taylor Nelson Sofres company


Most of the nation's top advertisers slashed their budgets during the first half of 2001. The top spender, General Motors, cut a significant 23.5% of its ad spending from the first half of last year, trimming $1.4 billion down to $1.1 billion. Philip Morris, DaimlerChrysler and Walt Disney also dramatically cut spending. In sharp contrast, however, media giant AOL Time Warner upped its ad spending by over 20 percent.

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