Down Is Still Up, Slightly
A recent report by the Publishers Information Bureau shows that ad revenue and ad pages for leading magazines fell noticeably in May compared with May 2000. " There are not many months left for good news to come out," said Robert J. Coen, senior vice president and forecasting director at Universal McCann in New York.
His June, 2000 forecast for 2001 was that ad spending would increase 6.5 % from 2000. He reduced that estimate in December to an increase of 5.8 % after witnessing the decline in ad spending in traditional media by the dot-coms. He observed that the first half of 2001 is drawing to a close with few signs that the weakening of the advertising and media economies will reverse itself anytime soon.
Michael J. Russell Jr., an analyst at Morgan Stanley, says that "Last year, a rising tide lifted all the boats. Now, a falling tide is bringing all the boats aground." One such boat is magazines, where the declines in ad spending and ad pages last month were most evident in several large, important categories:
- Financial, insurance and real estate, were down 21.5% in ad revenue and 32.7% in ad pages
- Media and advertising, down 24.9% in ad revenue and 36.7% in ad pages.
- Retail was down 38.4% in ad revenue and 32.1% in ad pages.
- Technology was down 45% in ad revenue and 52.7% in ad pages.
- Ad linage in The Wall Street Journal, fell 35.8% in May compared with May 2000.
For magazines last month, according to the Publishers' Bureau:
- Ad revenue totaled $1.5 billion, down 9.4 % from $1.7 billion in May 2000
- Ad pages fell 16.9%, to 22,368 from 26,928.
- Ad revenue for the first five months of 2001 totaled $6.7 billion, down 1.9% from the period a year earlier as ad pages were down 9.4%.
Ellen Oppenheim, executive vice president and chief marketing officer at the Magazine Publishers of America, says that "many advertisers are playing a waiting game," searching for signs that consumers are willing to resume spending before they commit scarce ad dollars.
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