Newspaper ad growth eases

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Newspaper ad spending growth slowed to 6.19% in the second quarter from 7.25% in the first quarter, but the medium is "on track" to finish 1998 with a full-year increase of between 6.5% and 6.7%, the Newspaper Association of America, Vienna, Va., said. For the first half, ad spending in newspapers totaled $20.4 billion, up 6.7% from a year ago. "Newspaper advertising tends to be slower in the second quarter, with the dip in classified being a normal part of the cycle," said Miles Groves, NAA chief economist and senior VP-market and business analysis. Classified, a key newspaper ad spending category, grew 10% in the first quarter but 6.1% in the second. For the half, spending on classified ads was up 7.9% to $8.2 billion. Spending growth in retail advertising grew at a faster clip in the second quarter (up 5.6% compared with 1997) than in the first (up 4.1%). For the half, retail ad spending was up 4.9% over last year to $9.3 billion. National ad spending growth in newspapers, up 10.1% in the first quarter, eased to a still robust 8.5% gain in the second quarter. For the half, the category was up 9.3% to $2.9 billion. Earlier today, a stock-market story in The New York Times noted the Standard & Poor's 500 Newspaper Index was off 13% from the end of June compared with a 10% decline in the broader S&P 500 stock index. Analysts explaining the difference cited concerns about the economy and about future newsprint prices.

Copyright August 1998, Crain Communications Inc.

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