Magna: Smaller Ad Growth In 2012, Broadcast TV, Nets See Biggest Rise


The U.S. advertising business slowed down at the end of 2011, and although MagnaGlobal expects growth to improve in 2012 -- up 3.7% -- it could be viewed as a weak performance.

Much of the 2012 gain comes from the usual suspects -- a big political advertising year, as well as the marketing for the Summer Olympics. The media agency unit predicts U.S. advertising will land at $152.9 billion for 2012.

Taking out political and Olympic advertising, MagnaGlobal says core media advertising revenues will climb by 2.0% in 2012, to $149.8 billion. That would be a slowdown compared to 2011’s core media growth of 4.5%.

Advertising growth for the third quarter of 2011 was 2.3%, and slowed to 1.1% in the fourth quarter. This came after a robust 4.3% gain in the first six months of the year. Looking at core media revenues for 2011 -- but not direct marketing -- marketers' existing business was up 2.9% in 2011 to $147.4 billion. This is still 13% below pre-recession levels in 2007 when the business topped out at $168.7 billion.

The biggest category -- broadcast television -- will gain from political and Olympic advertising, up 8.5% for the year. Total television -- cable, syndication, broadcast and local -- will grow by 6.8% to $62.4 billion.

The biggest gainers in 2011 will also be the biggest in 2012: Internet marketing/advertising -- with a 10.9% gain in 2012, says MagnaGlobal. But this is down from the growth in 2011 of 21.4%. Specifically, paid search will grow 12.6%; online video, 22.4%; and mobile, 44.2%.

Outdoor media will climb 4.0%.

Declining categories for 2012 include: newspapers, off 6.0%; magazines, down 5.2%; and radio, losing a bit, 0.8%. Also on the losing end is direct marketing: directories' revenues will decline 19.1% and direct mail, 1.9%.

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