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/ 09.07.2010 12:00PM
Ad Market Rebounds After Two-year Slide
MONTEREY, CALIF.: SNL Kagan says the U.S. advertising market is recovering
after two tough years. The total ad market is projected to reach $210.5 billion
this year, up nearly three percent following declines in 2008 and 2009. SNL
Kagan forecasts the market will continue to grow, reaching $214.3 billion next
year and $275.8 billion by 2019.
The platforms expected to have the strongest growth this year will be mobile,
broadcast TV stations and Internet, while business publications and newspapers will
post the biggest drops. Kagan said old-media sectors are unlikely to recover
from the migration of ad spending toward new media.
“New media, such as mobile and Internet advertising, continue to boom, while
old media, particularly print, is increasingly losing its relevance. Dollars
are shifting into new platforms and those drawing the most eyeballs, such as
cable TV,” said Kagan’s Derek Baine. Cable’s take is projected to grow to $30.2
billion in 2011 and $55.1 billion by 2019, up from $12 billion in 1999.
Daily newspapers revenues have declined from $46.3 billion in 1999 to a forecasted
$23 billion in 2011, Kagan analysts noted. Losses are expected to level off,
with revenues remaining flat going forward. Kagan projects newspaper revenues
to be $22.5 billion in 2019. Conversely, Internet advertising has grown from
$4.7 billion in 1999 to around $27.8 billion in 2011. It’s expected to more
than double by 2019, reaching $60.1 billion.
Kagan’s U.S. ad market forecast follows one issued by PricewaterhouseCoopers in June,
predicting U.S. ad revenues to grow 2.6 percent annually to reach a total of
just $180 billion in 2014. That’s significantly less than Kagan’s projection of
$214.3 billion in 2011, but both firms agree that print is contracting and
unlikely to recover to pre-Internet levels. PwC said Internet ad spending would
surpass that for newspapers for the first time this year.
-- Deborah D. McAdams
See...
June 15, 2010: “Advertising Won’t
Rebound to ’07 Levels”
“Advertising revenues remain fragile in nature and spending is unlikely to
return to former levels. By 2014, the U.S. advertising spend is expected to
still be 9 percent below its level in 2007.”
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