Net leads surge in ad spending

Up 49% in '06 amid 5.1% overall gain; net radio off

Ad spending jumped 5.1% during the first nine months of 2006 compared with the same period a year ago, Nielsen Monitor-Plus said Tuesday.

Internet-related spending once again showed the strongest percentage gain among all media sectors, with a 49% increase compared with the first nine months of 2005. Spanish-language TV also had a good stretch, increasing 17% during the same period. National newspaper advertising was up 8.4%, while spot TV — buoyed by Olympic and political advertising — was up 7.4%. Local magazine ad spending rose 7%, outperforming national magazine ad spending (up 4.3%) and newspaper Sunday supplements (up 5.6%). Outdoor demand rose 5.8%, ahead of the percentage increase for network TV (up 4.1%) and national cable TV (up 1.3%).

But it wasn't all good news. Several media sectors were down, including local newspapers (3.8%), network radio (2.9%) and business-to-business magazines (down 2.4%). Spot radio and small-market spot TV were flat.

Most of the top 10 national advertisers increased their spending in the first three quarters in an aggregate increase of 4.3% — totaling $13 billion — that nearly mirrored the overall ad market. The top spender was Procter & Gamble Co., which increased spending 4.1% to $2.6 billion, while the second-biggest advertiser, General Motors, cut spending 15% to $1.8 billion in the first three quarters of 2006. AT&T had the largest percentage increase in ad spend of the top 10 advertisers, rising 48% to $1.3 billion, while Verizon jumped 25% to $1 billion. Both AT&T and Verizon's spending went up because of mergers and acquisitions, with AT&T involving the SBC deal and Verizon involving MCI. DaimlerChrysler cut spending nearly 4%.

The top categories were automotive factory and dealer associations (up 1%), pharmaceutical (up 9%), auto dealerships (down 4.6%), quick-serve restaurants (up 7.3%) and motion pictures (up 3%). Only credit card services were also down among the top 10 categories.