Ad spending improves in fourth quarter

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While overall ad spending plummeted last year as a result of the recession, the decline slowed a bit in the fourth quarter, and that trend has carried over into this year, according to a recent report from Kantar Media. Things are healthier in the interactive advertising sector. According to a study released last week by the Interactive Advertising Bureau and PricewaterhouseCoopers, Internet advertising, off overall for 2009, rebounded to a record fourth quarter. Overall U.S. ad spending totaled $125.3 billion last year, down 12.3% from 2008, according to Kantar (previously TNS Media Intelligence). In the fourth quarter, ad spending declined 6.0% from the year-earlier period. “The first nine months of the year were like one big global iceberg in terms of ad spending,” said Jon Swallen, senior VP-research at Kantar. “The cutbacks spread across all media categories and across all major advertisers. “Starting in the fourth quarter, we started to see a little bit of a thaw. There was still a decline in ad spending, but while the first nine months were tracking at a 13%-to-14% decline, the fourth quarter was along the lines of a 6% decline.” The IAB study found that Internet advertising declined 3% last year to $22.66 billion, from the $23.40 billion in 2008. Spending turned around in the fourth quarter to hit a record $6.3 billion, up 3% from the $6.1 billion spent in the year-earlier period. “Not only was this a record quarter for interactive advertising, but ... we are outpacing the media marketplace,” said Sherrill Mane, IAB senior VP-industry services. The hardest-hit media categories last year were local magazines (down 27.7% for the year), b-to-b magazines (down 26.2%), national spot radio (down 24.6%) and spot TV (down 23.7%), according to the Kantar study. The top three advertising categories in terms of spending were automotive ($11 billion, down 23.4% from 2008), telecom ($8.6 billion, up 1.6%) and financial services ($7.8 billion, down 18.3%). “The data from January and February suggest that things are continuing to improve,” Swallen said. “All media categories are improving on their performance from as recently as the fourth quarter.” Swallen said Internet, radio and most forms of TV advertising are leading the growth this year. “Newspapers and magazines continue to lag behind, although their business is improving. It looks like the hole has bottomed out, and we are beginning to start climbing up.” Search advertising led all digital categories in 2009 with $10.5 billion in spending, up 1% from the prior year, according to the IAB-PWC study. Second in total spending was the ad banners and display ads category at $5.1 billion, up 4% over 2008. Digital video attracted $1 billion in advertising last year, up 39% from 2008. M
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