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US ad spend to grow by 2.7 per cent: TNS

MUMBAI: Total US ad spending is expected to increase 2.6 per cent in 2007 to $153.7 billion, according to the full-year forecast released by TNS Media Intelligence which provides strategic advertising and marketing information.

This anticipated tepid gain is the smallest since the media economy emerged from its 2001 recession and follows estimated advertising spending growth of 3.8 per cent in 2006.



Ad expenditures are forecast to increase by just gain of 3.2 per cent in the second half, paralleling an expected late year uptick in overall economic activity.

TNS Media Intelligence president and CEO Steven Fredericks says, “Our outlook for 2007 is tempered by the absence of two biennial advertising events, the Olympics and federal elections, which tend to contribute an incremental 80-100 basis points to growth rates. More significant, we expect share of total ad spending will continue to shift away from the top 100 marketers, as media fragmentation enables more brands with smaller media budgets to participate in the market, while concurrently helping dampen media price inflation.



“Based on our forecast, 2007 is poised to be the third consecutive year in which the advertising sector more closely tracks growth in real GDP as opposed to its historical reference mark of nominal GDP. The forces driving this new pattern appear to be sustaining and there is little reason to believe a return to the old order will be forthcoming.”



Internet display advertising is expected to continue growing at double-digit rates in 2007 with syndication TV, outdoor and magazines also exceeding the overall market average. Network TV is projected to be almost flat versus 2006, while newspapers and spot TV are expected to experience outright declines in ad revenue.

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