Ad spending sees solid year-end gains
Out of home posts 3.4 percent gain and radio up 4 percent
March 8, 2013
It will still be a couple weeks before the final ad spending numbers for 2012 are out.
But several media have released their own numbers, and though forecasters kept lowering their outlooks for 2012 as the year went on, it seems advertising made some decent gains by the time the year finished out.
Radio recorded its third straight year of growth, up 1 percent, including a 4 percent fourth-quarter surge fueled by automotive and political.
And out of home grew a robust 4.2 percent, ending the year with its 11th straight quarter of growth.
Both media had strong fourth quarters despite less-than-robust holiday sales, which led to less advertising than many buyers had expected, and worries over the fiscal cliff, which buyers say didn’t end up impacting advertising as much as many had feared.
“Some advertisers may have held back a couple weeks, but in the end did it really affect anything? No,” says Gerri Donini, senior vice president of national buying at RJ Palmer.
In December, buyers told Media Life that some advertisers were spooked by the fiscal cliff, a series of spending cuts slated to take effect in January. The situation was averted by a deal reached in the last days of 2012.
Out of home grew 3.2 percent in fourth quarter. Communications saw the biggest year-to-year gain in the quarter, up 22.2 percent, a big change from earlier in the year, when spending was down.
For the year, political was an important ad spending driver, as it was in radio and television. Government, political and organizations accounted for 30 percent of the 2012 gain in ad spending in out of home, with $319 million spent.
Radio had its best quarter of growth in two years during fourth quarter, with spot up 4 percent and digital growing 11 percent.
Professional services, communications and financial services also had strong fourth quarters, seeing at least 15 percent year-over-year growth.
Some $124 million was spent on political ads on the medium, increasing 15 percent over the $108 million spent during the 2008 campaign.
Looking ahead to 2013, the outlook is good for both out of home and radio. Donini says that despite all the recent hype over sequestration, another series of spending cuts that went into effect last week, the impact on ad spending will be minimal.
“The only thing I think it could impact is government ad spending, such as military recruitment,” she says.
“The army does a lot of recruitment, and so does the Navy. And their budgets are quite a bit down. But they also need fewer servicemen right now, so that might affect it as well.”
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