Expect a boom in holiday ad spending

Political advertising is getting all the headlines right now, but another major spending period just opened that will drive the media economy through the end of the year.

Sept. 16 marked 100 days until Christmas, and that means retailers are starting to ramp up their advertising efforts.

Despite the continued economic struggles, forecasters expect that consumer spending will be up this holiday season.

Deloitte has predicted a 3.5 to 4 percent rise in holiday sales this year compared to last, including a big gain in online sales.

That, in turn, will drive retail ad spending.

“In their efforts to get their share of consumer dollars, many retailers are out of the gate with seasonal items, almost skipping right over Halloween,” says Irene Neveil, vice president at Harmelin Media.

“This should be a hearty season for media spending due to the need for the retailers to top one another.”

Year-to-date retail ad spending is up 5 percent, according to Neveil. Spanish-language television and print are seeing the biggest gains in terms of percentage growth.

But online display is showing the greatest growth in terms of dollars, reflecting consumers’ greater consumption of online media.

For the holiday season, TV and cable will once again get the bulk of retailers’ dollars, Neveil predicts, while online will continue to see huge increases.

“Within online we are seeing increased spending in paid search but also video, as it gets easier to buy and track, and consumers are accepting of it,” Neveil says.

Much of the local TV push will come after the November election. Right now political advertising is putting the squeeze on spot television, jacking up prices and leading to nearly sold-out conditions across many markets.

As soon as the election’s over, spot TV inventory will be available again, and retailers are expected to snatch it up.

Apparel retailers are expected to spend the most money on advertising this holiday season, in keeping with past years.

Another sign that retailers are expecting a strong holiday sales season is the increase in seasonal workers they have hired to deal with in-store crowds and online orders.

Toys R Us is hiring 15 percent more of them this year than last, and Walmart and Kohl’s both plan to hire slightly more than 2011 as well.

“With the assistance of the internet, the shopping experience is so much easier than in the old days,” Neveil says.  

“Retailers like Toys R Us are hiring more seasonal workers than ever, partly due to the need to have people who can help fulfill orders purchased online to pick up at a store. By offering these services as well as customer loyalty rewards, retailers can capture greater shares of spending.”
 

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