• by Jack Loechner , Staff Writer @mp_research, June 7, 2010

According to data recently released by Kantar Media, total advertising expenditures in the first quarter of 2010 rose 5.1% from a year ago and finished the period at $31.3 billion, marking the first increase in quarterly ad spending since Q1 2008 and the largest gain since Q1 2006, as the ad market finally experienced a long-awaited rebound.

Jon Swallen, SVP Research at Kantar Media, says "... marketers appear to be more confident about a pickup in consumer activity and have increased ad budgets... Q1 spending hikes were broadly distributed across advertisers and categories... an encouraging signal for the market going forward."

Of the nineteen media types tracked, thirteen experienced a spending increase in the first quarter. Spot TV surged 22.0% on a torrent of additional money from the automotive, retail, financial service and political categories. Despite this growth, current spending volume in Spot TV has only recovered to a level last seen in 1997.

Other television media types also performed strongly. Network TV expenditures finished the period up 11.6%. Cable TV (+8.2%), and Spanish Language TV (+7.2%) each benefitted from selling more ad time and strengthened demand among across a broad range of package goods and retail advertisers.

National Spot Radio advanced 19.0% and was paced by higher spending from the telecom, financial service and auto categories. Local Radio and Network Radio were also up.

Print media, on the whole, continued to lag the overall ad market. Consumer Magazine spending fell 3.9% from a year ago while Local Newspapers dropped 5.6%. There was improvement in some narrow segments as Sunday Magazine expenditures jumped 13.7% and National Newspapers increased 9.1%, primarily from gains at the Wall Street Journal.

Expenditures for the ten largest advertisers in the first quarter jumped 10.6% to $4.34 billion. Among the Top 100 advertisers, a diversified group representing nearly one-half of the measured ad economy, spending was up 11.0% to $14.89 billion. The long-tail of small advertisers, those outside the Top 1000, were far below these growth rates and posted a 1.1% decline in their aggregate media investments.

Procter & Gamble kept its position as the largest advertiser with $772.6 million in spending, an increase of 17.7% versus a year ago. The company continued to shift budgets towards magazines and away from television.

AT&T rose to the second spot with spending of $576.4 million, up 26.7%, behind a large television ad buy in the Winter Olympics. Rival Verizon Communications reduced its total expenditures by 9.1%, to $517.2 million. Both telecom companies continued to allocate more resources to promote their TV service products as they try to win subscribers from cable and satellite operators.

Pfizer posted the highest growth rate with expenditures up 46.2% to $396.4 million as the company maintained aggressive marketing support for Lipitor prior to the brand going off patent in 2011. With auto industry sales picking up, General Motors accelerated its spending by 28.5% to $533.7 million and accounted for more than one-fourth of all ad dollars spent by auto manufacturers.

News Corp (+7.8%, to 366.8 million) and Time Warner (+14.7%, to $304.3 million) also had notable increases. At both companies the results were primarily shaped by their movie studio divisions

Expenditures for the ten largest advertising categories rose 7.8% in the first quarter and totaled $17.95 billion. All but one of the Top Ten categories was up, indicating broad participation in the ad spending recovery.

Automotive was the leading category by dollar volume and also had the highest growth rate among the Top Ten as spending soared 18.6% to $3,016.8 million, ending a streak of 18 consecutive quarterly declines. Manufacturers and dealerships reacted quickly to an improving sales environment by ramping up marketing efforts with TV, magazines and radio being the main beneficiaries.

Telecom was the second largest category as expenditures reached $2,276.5 million, an increase of 10.6%. Financial Services also experienced a revival with outlays up 10.1% to $2,028.7 million. Sharply higher spending from marketers of credit cards and loan products offset continued weakness within the consumer banking segment.

Packaged goods categories, where advertisers took advantage of soft ad pricing in 2009 to bolster their media weight, were undaunted by rising ad prices in the first quarter of 2010. Spending from Food & Candy was up 7.3% to $1,600.0 million and expenditures for Personal Care Products increased by 5.5% to $1,311.5 million.

Restaurant category spending also turned around with modest growth of 3.1%, to $1.454.5 million. A major contributor to the gain was McDonald's television sponsorship of the Winter Olympics.

In the first quarter of 2010, an average hour of monitored prime time network programming contained ten minutes, fifty five seconds of in-show Brand Appearances and 14:20 of network commercial messages. The combined total of 25:15 of marketing content represents 42% of a prime-time hour.

Unscripted reality programming had an average of 19:42 per hour of Brand Appearances as compared to just 6:59 per hour for scripted programs such as sitcoms and dramas. Late night network talk shows had an average of 11:58 per hour. The combined load of Brand Appearances and network ad messages in these late night shows was 28:21 per hour, or 47% of total content time.

The top five brands ranked by total amount of Brand Appearance time were Coca-Cola, Asics, 24 Hour Fitness Center, Brita Water Purifiers and Yamaha Music Equipment.

Please find more about Kantar and the study here.