As Ad Spending Rises, Print Still Suffers

Here’s a promising sign that we’re finally pulling out of the recession: As The Wall Street Journal noted [1] this morning, Publicis Groupe's ZenithOptimedia is reporting [2] that U.S. ad spending is expected to increase 2.5 percent to $155.2 billion in 2011.

Online ad spending will see the biggest rise at 13 percent, followed by cable television (10 percent) and cinema (6 percent). The future still looks pretty bleak for print media, though. The report forecasts that ad  spending in print publications will actually drop: newspapers will take a 8.6 percent hit this year, while business publications should expect a 4 percent drop, and consumer magazines a 1 percent dip.

Don’t expect to see the revival of print advertising anytime soon, either. By 2013, ZenithOptimedia projects, the Internet will overtake newspapers to become the world’s second-largest advertising medium after TV. “While we have long expected this to happen in the near future, this is the first time this event has fallen within our forecast period,” the report states. “Newspaper ad expenditure was still 51 percent larger than Internet ad expenditure in 2010, but newspaper expenditure is shrinking by 1.4 percent a year, as circulations continue to fall in developed markets, and readers migrate to the Internet. Meanwhile, Internet advertising continues to grow at breakneck pace.”

Global advertising is also taking a slight hit. While ZenithOptimedia’s December report estimated that global spending would increase by 4.6 percent, that percentage is now down to 4.2 percent. Unrest in the Middle East and the myriad disasters in Japan are to blame for the new numbers: there was almost no advertising on Egyptian television during the revolution, and commercial ads in Japan were almost entirely replaced by public service announcements after the tsunami and earthquake.