TNS: Q1 Ads Up Only 0.6% vs. '07

With the economy on shaky ground, U.S. advertising barely moved in first quarter, up only 0.6 percent compared to the same period last year, according to data released Wednesday (June 11) by TNS Media Intelligence.Things aren't expected to get much better. "After a hopeful start to the year, the pace of ad spending slowed perceptibly during March and early figures from the second quarter indicate little immediate or sustained improvement in the core ad economy," said Jon Swallen, senior vp of research at TNSMI.The sluggish ad trends may force TNSMI to adjust downward its 4.2 percent year-end forecast, which called for 3.6 percent lift in the first half of the year, followed by a stronger second half, driven by a combination of Olympics and political spending. "Clearly 0.6 percent was not in the forecast as the pathway to 3.6 percent growth for the first six months. We're on a much slower track," Swallen said. Keeping a close eye on the economy, advertisers appear to be waiting longer to make decisions to commit funds. "We've been seeing more bounce month to month in adspend figures. As the economy gets shakier, advertisers take a more cautious approach and we may continue to see more bounce going forward," Swallen said. Some of the nation's top 10 advertisers significantly cut budgets in first quarter, including AT&T (down 14.6 percent), Time Warner (down 6.8 percent), Walt Disney Co. (down 7.9 percent) and Johnson & Johnson (down 15.3 percent). The auto category continues to slump and as a result of gas prices and the economy, domestic advertisers cut back sharply on truck advertising. Ford Motor Co. slashed its spending by 31 percent, though General Motors increased spending by 12.6 percent. With a few exceptions, media segments posted tepid or negative growth. Even Internet display advertising, which has posted double-digit growth rates, moderated some to a healthy 8.5 percent gain. Outdoor, another healthy growth medium, was up only 2.5 percent. Also slowing from previous quarters, was cable up 4.1 percent.Newspapers and radio media took the biggest hits, down 5.2 percent and 4.5 percent, respectively. Bucking the trend, network radio was up 12 percent.Network TV, which attracts the most ad spending grew an anemic 0.8 percent, ironically, its best quarterly performance in two full years, since the Winter Olympics in 2006. Less resistant to the writer's strike, syndication TV grew 11.2 percent. Despite the promise of an even-numbered year, Spot TV, down 2.4 percent got hit with dramatic slowdown in three of its core categories, automotive, financial services and retail.

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TNS: Q1 Ads Up Only 0.6% vs. '07

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