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Room to Grow Finding no obvious correlation between growth in ad spending in a particular industry and growth in sales, research firm Schonfeld & Associates expects 1998 ad spending in the 10 largest advertising segments to rise as much as 10.7 percent (for pharmaceuticals) and as little as 4.5 percent (home electronics). Sales-growth estimates for these categories cover a wider range, with drug companies the most robust, up 11.7 percent, but department stores down 7.8 percent-despite an 8.6 percent increase in ad outlays by the big 10. Pharmaceuticals have good reason to sustain the ad pressure. Some big-selling drugs are about to lose their patent protection, which means the "name" brands will soon face competition from generics. At the same time, the FDA has loosened the restraints on prescription-drug advertising, making it practical to use TV. Another fast-growing category is telephone service, where ad spending is expected to jump 10.1 percent. Industry-revenue information is incomplete, but it appears ad spending claims only 2.1 percent of telephony's sales, leaving plenty of room for expansion.-Alan Gottesman (westendal pobox.com) is principal of West End Consulting.


THE GOTTESMAN FILE
The "Advertising Ratios & Budgets" study estimates 1998 ad spending and sales numbers for most major industries.

..........Ad spending.....Ad growth.....Sales growth.....A/S ratio*
.....Food.....$21.1.....5.2%.....9.7%.....7.8%
.....Motor vehicles.....$15.1.....5.6%.....5.6%.....2.4%
.....Pharmaceuticals.....$12.9.....10.7%.....11.7%.....5.2%
.....Phone service.....$12.0.....10.1%.....0.2%.....2.1%
.....Beverages.....$8.5.....10.8%.....9.8%.....7.6%
.....Department stores.....$5.1.....8.6%.....-7.8%.....3.6%
.....Soap.....$4.4.....5.4%.....6.5%.....9.7%
.....Home electronics.....$4.2.....4.5%.....6.3%.....3.3%
.....Source: Schonfeld & Associates. Dollar figures in billions. *Advertising to sales