Top 10 Advertisers Spent 3% Less in ’05

WASHINGTON A slowdown in the ad market during the fourth quarter contributed to a modest 3 percent gain in advertising spending to $143.3 billion for 2005, according to data released late Monday by TNS Media Intelligence, which tracks spending across 19 media segments.

Spending among the top 10 U.S. advertisers dropped 3.3 percent to $18.6 billion compared to 2004. Eight of the top 10 advertisers slashed budgets including advertising behemoth Procter & Gamble, which spent $3.2 billion last year, a decline of 4.6 percent. Other advertisers that cut budgets include AT&T, DaimlerChrysler, Walt Disney, Johnson & Johnson and Sprint Nextel.

“Consumers and businesses turned a bit more cautious,” said John Swallen, svp of research for TNS, who noted that fourth-quarter spending increased only 3 percent. “Large blue-chip advertisers, as a group, have recently cut back their ad budgets. The growth is currently coming from outside the Top 100 markets.”

With the exception of network TV, spot TV, national spot radio and network radio, all media segments posted growth last year. Once again the Internet grew the most, climbing 13.3 percent to $8.3 billion, followed by cable TV, up 11.4 percent to $15.8 billion, and outdoor, up 9.8 percent to $3.5 billion.

As expected in an odd-numbered year without Olympics and political dollars, spot TV fell 9.5 percent to $15.5 billion. Network TV dollars decreased 0.3 percent to $22.4 billion. Battling a soft ad market, national spot radio was down 0.5 percent to $2.6 billion and network radio declined 1.7 percent to slightly more than $1 billion.

Although newspapers ad dollars increased by only 1 percent to $25 billion, it is still the biggest billing medium, followed by network TV and consumer magazines, which grew 7.5 percent to $21.6 billion.

Other media showing gains were: Local radio, up 1.3 percent to $7.3 billion; business-to-business magazines, up 2.4 percent to $4.4 billion; national syndication, up 7.4 percent to $4.2 billion; Spanish-language media, up more than 6 percent to $4.2 billion; national newspapers, up 5 percent to $3.4 billion; Sunday magazines, up more than 8 percent to $1.6 billion; freestanding inserts, up 3.6 percent to $1.4 billion; and local magazines (based on 26 magazines), up 21.3 percent to $385 million.

While growth may have been lackluster, there was no shortage of commercial clutter on TV. During the fourth quarter in prime time, brand appearances took up 4:24 minutes of program time, along with 17:35 minutes of commercials per hour.

Reality programs had the most product placement with 11:05 of brand appearances and 17:04 of commercial time compared to scripted programs, which had 3:07 of brand appearances and 17:41 of commercial time.

The Apprentice: Martha Stewart devoted the most time to brand appearances within the program with 33:51 minutes, followed by Biggest Loser (23:08), The Apprentice: Donald Trump (21:15), Amazing Race: Family (19:40) and Fear Factor (17:11). Among scripted programs King of Queens had the most time devoted to product placement with 18:13 minutes.

TNS recently forecast 2006 ad spending would grow 5.4 percent to $152 billion.