Japan ad billings hit record high in 1997

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TOKYO -- Japanese advertising billings hit a record high in 1997 despite the country's economic downturn that started in the latter half of last year, a financial daily reported.

Total billings are estimated to have risen by 3.5% from 1996 to tally about 6 trillion yen or $48 billion. Competition among automakers along with increased spending by the telecommunications and information technology sectors are the main reasons for the increase, the Nihon Kogyo Shimbun reported. Revenue growth started to decline in the latter half of last year and any future gains in 1998 will greatly depend to what extent Japan can lift itself out of its current economic malaise.

Japan's three biggest advertising companies-- Dentsu Inc., Hakuhodo Inc. and Tokyo Agency Inc.-- all posted record billings for the year.

According to figures released by Dentsu, the company had total billings of 1.33 trillion yen or $10.64 billion for the year, marking a 6.2% increase over 1996 figures. The previous record was 1.29 trillion yen rung up in 1991, the last year of Japan's asset inflated bubble economy.

TV billings, the largest sector for the company, were up by 6% to hit 659 billion yen ($5.27 billion) for the year.

Hakuhodo posted total billings of 709.7 billion yen ($5.68 billion), marking a 7.3% increase over 1996. Intensive ad efforts from Hakuhodo clients such as Nissan Motor Co. and Mazda Motor Co. helped Japan's number No. 2 ad agency break its billings record. Tokyu had billings of 198.3 billion yen ($1.59 billion), up 6.5%.

Despite Japan's economic downturn, the big money for ads on TV and in national newspapers and major magazines is still expected to flow over the short run, but there is fear at smaller publications and smaller media outlets that advertising money is starting to dry up.

Japan's major advertising companies are worried that if the economy does not pick up, cuts in advertising expenditures may finally be on the list for corporate austerity measures.

Copyright January 1998, Crain Communications Inc.

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