Dentsu Ad Spend Down

by , Jan 11, 2013, 3:45 PM
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Tokyo-based agency holding company Dentsu Inc. Friday reported a 2.5% decrease in client ad spending during December, compared to December 2011. It was the fourth consecutive month in which client spending declined, the firm indicated.  

The good news: the negative trend is steadily improving, the company said, noting that the December dip in spending was an improvement over November when expenditures were down almost 7% versus the prior year period.

A rep for the company attributed the drop in last month’s spending to the fact that there were no major events then on the scale of the Tokyo Motor Show, held in December 2011, that attracted major sponsorship dollars.

December ad spending was down in 11 categories, including consumer electronics and appliances, automobiles, beverages and cigarettes. Spending was up in nine categories, including communications, government/organizations and distribution/retailing.  

By medium, television spending was roughly flat for the month, while radio was down more than 5%. Digital and out-of-home were down a little more than 1% and print was up 4%.

Dentsu reported the December figures shortly after revealing that it was launching an early retirement program targeting 100 employees. Those opting for the program will retire effective March 31.

Asked if the retirement program was related to the spending drop, the Dentsu rep replied that it was not.  He said that while clients had cut back on spending, the company’s financial picture remained healthy, noting a nearly 52% operating income gain for the first half of the company’s current fiscal year.  

The rep also confirmed that the company planned "no further action" if fewer than 100 employees opted to retire. “We are not expecting more than 100,” he added. “However, if the number exceeds 100, our management will have a board meeting and decide how to deal with all the applicants.”

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