NEW YORK Media advertising forecaster Bob Coen, svp at Universal McCann, said he significantly overprojected ad spending for 2007 last December in his semi-annual forecast and today revised his totals, saying combined national and local ad spending will total $290.3 billion, $8 billion less than his original forecast. But national ad spending will still be up in 2007 over 2006.
Coen said national ad spending in 2007 would be $190 billion, up 4.2 percent over 2006. In December he had forecast national spending in 2007 would be $195.6 billion, up 5.9 percent. Local ad spending, Coen predicts, will now reach $100.2 billion in 2007, up 1.7 percent. Last December, he projected it would be $103.1 billion, up 2.7 percent.
Coen said 2006 turned out not to be a very good year for ad spending, despite it being an Olympics and election year. He said that has carried over into this year.
In a usual Olympics and election year, he said, ad spending usually rises by close to 6 percent overall, but 2006 finished with only a 3.9 percent increase to $281.6 billion. That impacted his projections for this year.
This year has also not started off well as far as ad spending goes. Coen said in the first quarter of this year major ad categories like automotive and telecommunications are down 11 percent and 14 percent, respectively, in national television, and other categories like soft drinks and airlines are down 17 percent and 24 percent, respectively, in national TV spending.
On the local side, classified advertising in newspapers is down significantly, with that category projected to be off 13.2 percent for 2007.
"The outlook for advertising this year is not very good," Coen said. "In odd-numbered years there is a significant fall-off in political advertising from the levels of the even-numbered years when all members of the House of Representatives and one-third of the Senate are involved in election contests."
Coen said at this time it is "wishful thinking" that any significant ad revenue would be gained from presidential primary campaigns or that traditional media will gain huge amounts of new ad revenue for their online services.
For 2007, Coen projects that the Big Four broadcast TV networks will take in $17.1 billion in ad revenue, up 3 percent over 2006. Other Coen projections: All of cable TV, he said, would take in $20.1 billion, up 4.5 percent. Magazines will bring in $13.5 billion in ad revenue, up 4 percent; syndication TV will bring in $3.6 billion, down 2 percent; national radio will reap $4.5 billion, up 2.5 percent; and newspapers will bring in $7 billion, up 1 percent. Internet advertising, Coen projects, will be up 17 percent to $10.6 billion in 2007.
Coen also made local projections for 2007: newspaper advertising would be down 1.5 percent to $38.8 billion; local TV, up 8 percent to $15.3 billion; and local radio up 2 percent to $15.5 billion.
Emerging media, although a growing ad category percentage wise within itself, will have little overall impact on traditional media in the near future, according to Brian Wieser, svp, director industry analysis at Magna Global, the media buying negotiator for Universal McCann and other Interpublic media agencies.
Wieser said contrary to what many believe, younger audiences are not abandoning TV for emerging media. Younger viewers, he said, are actually watching more TV, in addition to using emerging media. He said video viewing online is less than 1 percent of total traditional TV viewing at this time. Online video advertising will total $365 million this year, he said. Other forms of emerging media advertising like video-on-demand will bring in $160 million in 2007, mobile wireless advertising will total $100 million, and in-game advertising will reach $216.9 million.