Ad spends on cable grow at cost of networks: Kantar Media

MUMBAI: Broadcast networks in the US continued to stumble despite humble gains in advertising spends on television as a whole.

During the first half of 2011, advertising sales at the broadcast networks reduced by 7.6 per cent to $10.8 billion.
According to a report issued by Kantar Media, several factors contributed to this reduction.

The broadcast of BCS bowl games on ESPN instead of Fox generated a major one-time shift in spending to cable. The shift of March Madness from CBS to Turner Sports benefited cables further at the cost of networks.

To make things worse, ad spends on prescription drug, financial services, and consumer package goods categories were shifted to cables as well. From 1 June till 30 June, the budget allocations on cable networks were further augmented by 11.8 per cent, reaching a total of $10.8 billion.

Television on the whole rose by a meagre 1.8 per cent, as the total amount of monies spent in the medium touched $32.9 billion. TV accounted for approximately half (46 per cent) of the total advertising expenditures.

Overall, ad growth lost pace in the second quarter, as spending increased 2.8 per cent versus the year-ago period. In Q2 2010, the dollars increased 5.1 per cent.
Kantar Media North America executive vice president of research Jon Swallen said, "Advertising grew at a slower rate in the second quarter, contributing to speculation about the durability of an advertising recovery that is into its second year. Key ad spend indicators are painting a mixed picture.

On the one hand, a majority of media types actually improved their performance from Q1 to Q2. On the other, spending growth for the Top 100 advertisers stalled in Q2, and the ad market became more dependent on the comparatively smaller budgets of mid-sized advertisers."

In the first half, top 10 TV advertisers reduced their spending by 1.7 per cent to $5.17 billion. Six out of the major spenders slashed their ad spends to some extent.

AT&T remained the largest TV spender, buying $789.4 million in air time, down 3.7 per cent as compared to the same period a year-ago.

Other significant advertisers on television: Procter & Gamble ($762.7 million, down 11.3 per cent); General Motors ($570.3 million, down 7.7 per cent); Verizon ($478.1 million, down 22 per cent); Johnson & Johnson ($431.7 million, down 15.2 per cent) Ford Motor Co. (up 0.8 per cent to $410.8 million); Pfizer ($397.4 million, down 8.2 per cent) and McDonald‘s (up 7.3 per cent to $375.1 million).

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