Coen Trims Ad-Spend Projection | Adweek Coen Trims Ad-Spend Projection | Adweek
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Coen Trims Ad-Spend Projection

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NEW YORK Universal McCann ad forecaster Bob Coen today revised his full-year U.S. ad spending projection downward 2 percent by about $6 billion to $286.5 billion, due to continued softness in local markets and better clarity on broader trends now that full-year 2005 numbers have been finalized.

The new 2006 projection combines both national and local ad expenditures.

Last December, Coen, svp and director of forecasting, predicted local ad spending for 2006 would total $103 billion, up 4 percent. He has now shaved a percentage point off that projection, knocking it down to $101 million. Coen held firm on his projection of a 7 percent national increase.

"Cable is in trouble," Coen said in discussing his new projections today. He revised his projection for cable ad revenue in 2006 down from a 7 percent increase to a more modest 4.5 percent gain. He said figures in the first quarter have shown that the cable networks are not selling more ad units than last year, and that the segment's small 1.5 percent increase in ad spending in the first quarter was based solely on price increases. He said there is an indication that media buyers are becoming more resistant to paying price increases at the cable networks.

Total ad spending growth in 2005 was up slightly less than 3 percent, trailing the 3.5 percent growth in the national gross domestic product, revealing an "extremely cautious" outlook on the part of national marketers, Coen said. Factoring in inflation, "there was no real growth in advertising in 2005," he said.

Overseas ad spending growth in 2006 will be up 6 percent (versus the earlier prediction of 6.2 percent) to $316 billion, bringing total global expenditures to $602.4 billion for the year, up 5.8 percent, Coen said.

Coen's first projection for 2007: U.S. expenditures up 5.8 percent and overseas spending up 6.6 percent, yielding a worldwide total of $640 billion, up 6.2 percent.

—with John Consoli of Mediaweek