Cable, Web Boost Ad Budget Share, Broadcast, Print Erode

You might think that given the numerous factors influencing media planning in 2004 - the impact of political year spending, the erratic recovery of some ad-supported media, and the acute pressure to begin planning media out of the box - that pronounced shifts in media budgets would become apparent. Not so, according to an analysis of ad spending patterns through the first half of the year, which shows nary a shift in the share of ad spending going to the major measured media.

While overall ad spending on the 17 media measured by ad tracker TNS Media Intelligence/CMR rose 9.1 percent to $62 billion through the first half of 2004, there has been remarkably little change in their share of advertising budgets among the media. The greatest impetus went to cable TV (+0.79 advertising share points) and the Internet (+0.73 points) through the first six months, according to a MediaDailyNews analysis of the CMR data.

With the exception of modest share growth for syndication (+0.21 points) and national newspapers (+0.04 points), ad budget erosion was generally spread out across all other media. The biggest hits were experienced by print media, though consumer magazines (-0.09 points) experienced a relatively minor loss in share of ad spending during the half.



The greatest lost of ad budget share went to local radio (-0.29 points), B-to-B magazines (-0.28 points) and local newspapers (-0.26 points).

The findings seems counterintuitive in several regards:
* The erosion of broadcast TV ad spending during the first half of a presidential election year (the broadcast networks and spot TV each fell 0.12 share points)
* The inexplicable erosion of Hispanic media budgets (-0.13 points) during a period where multicultural media spending was expected to outpace, not trail general market outlays.
* And perhaps most tellingly, the fact that pressure has been put on media planners to fundamentally rethink the media mix.

CMR attributed the expansion of cable TV ad budget to "a strong indication of increased demand for targeted opportunities," but offered little explanation into the other share shifts, other than the obvious growth of the Internet and syndication.

What makes the local broadcast TV and newspaper share erosion even more puzzling, is the fact that another TNS division, Campaign Media Analysis Group, estimated that an incremental $398 million was spent on political and issues oriented ad campaigns during the first half of the year.

"Political messages are pouring dollars into the market. To date, we've captured more than 482,000 political and issue advocacy TV advertisements," noted Steven Fredericks, president-CEO of TNSMI/CMR. "The totals we are seeing in the first half of this year from political and issue advertising are strong indicators that for the 2004 election year, ad spending will total $1.5 billion dollars."

Ad Spending by Media: First Half 2004 vs. First Half 2003

Medium 1st Half '03 1st Half '04 Change
Newspapers (Local) 17.92% 17.66% -0.26 pts
Network TV 16.70% 16.58% -0.12 pts
Consumer Magazines 14.61% 14.52% -0.09 pts
Spot TV 11.68% 11.56% -0.12 pts
Cable TV 9.39% 10.18% +0.79 pts
Internet 4.74% 5.47% +0.73 pts
Local Radio 5.57% 5.28% -0.29 pts
B-to-B Magazines 4.10% 3.82% -0.28 pts
Syndication TV (National) 2.64% 2.85% +0.21 pts
Hispanic Media 2.78% 2.65% -0.13 pts
National Newspapers 2.46% 2.50% +0.04 pts
Outdoor 2.18% 2.07% -0.11 pts
National Spot Radio 1.96% 1.80% -0.16 pts
FSIs 1.14% 1.10% -0.04 pts
Sunday Magazines 1.09% 1.03% -0.06 pts
Network Radio 0.77% 0.74% -0.03 pts
Local Magazines 0.25% 0.25% No change
Total Ad Dollars (billions) $61,999.2 $67,628.2 +9.1%

Source: TNS Media Intelligence/CMR
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