Top 100 MegaBrands

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The nation's leading megabrands climbed to spectacular spending heights in 2000 but had little time to savor the view. Ever since, media advertising has been heading downhill, reflecting the general malaise in the U.S. economy.

General Motors Corp.'s Chevrolet for the third consecutive year led all megabrands in media spending at $819.2 million, up 6.2% over 1999 although trailing the heady 13.6% growth meted out by the Top 100 MegaBrands, according to Advertising Age's Top 100 MegaBrands report.

These elite brands, ranging from Chevrolet to Clorox cleaning products at $115.1 million, outpaced media spending growth of 12.4% for all advertisers and accounted for 26% of the nation's total media expenditures of $98.7 billion, according to Taylor Nelson Sofres' CMR, whose 11-media totals provide the foundation for this report.

But that was 2000, when no medium saw spending drop for the full year. By the end of first quarter 2001, all but three had fallen into the reduced-spending abyss as total media outlays dropped 6.7% from first quarter 2000, according to CMR. Media prognosticators, who at first expected a midyear turnaround, have now pushed that to 2002 and beyond.


Chevy rode the ebb tide in this year's first quarter, spending $184.7 million on its cars and trucks, down 6% from the year-earlier period. Chevrolet vehicles dropped 0.1 share point in the first quarter after slipping 0.4 share point to about 15% of the market for full-year 2000, according to Automotive News, a sibling publication of Ad Age. The nameplate continues the shift from print to TV begun in 2000; its print outlays declined 28% in the first quarter after falling 23% during all of 2000.

Autos nevertheless remained the cornerstone of the Top 100 in 2000 as well as for all advertisers. Collectively, autos accounted for $7.9 billion of Top 100 spending, up 6%, just short of a third of the group's total. Dodge, Toyota, Ford and Nissan megabrands joined Chevrolet in the top 10.

The auto category's dominance among the top brands eroded slightly in 2000 as both Ford Motor Co. and GM, facing overstocked inventories and sluggish sales by midyear, reduced or kept flat their spending in the second half. The slack was picked up by heavy spending from other categories, especially telecom and financial services.

Spending power of the megabrands was so dominant that they sustained growth levels of most ad media. Network TV drew 39.7% of its spending from the Top 100, whose ad volume grew 15.7%; spot TV pulled 30% of its spending from the Top 100, whose ad volume advanced 18.7%, and cable pulled 26% of its advertising from this group, with volume up 17.2%. Conversely, the Top 100 contributed only 17% and 20% of total advertising in magazines and newspapers, with volumes from this group up only 3.8% and 9%, respectively.

Print is hardly a shadow of its former self, especially when viewing magazines and newspapers from the perspective of top media categories composed of Top 200 MegaBrands, a group that dips to Lipton teas & foods at $66.7 million. In the Top 200, retail and auto advertising remain the backbone of print.

Of the Top 200's spending of $4.97 billion by retailers, 50.9% was delivered to print. The 30 autos in the group pumped 26% of their total media outlays (of $8.42 billion) into print, a volume almost equal to retailers. Although ad spending was up 7.8% among the 25 retail megabrands in the Top 200, the sector suffered a long, cold December with flat returns at the cash registers.


Retail's leading megabrand, Sears, tightened its ad belt in 2000 with spending dropping 11.4% overall and 20% in print, as the department store chain endured a rough year. Sears began 2001 closing underperforming stores and revising its marketing campaign; its media volume slipped 1% in the first quarter.

Telecom-the third-largest category, following autos and retail-grew 27.3% in ad spending from 16 megabrands in the Top 200 as advances in technology coupled with a deregulated environment crowded an evolving market with brands battling for name recognition. Many telecom stocks rose to giddy heights only to scrape bottom by the end of the year.

Troubled giant megabrand AT&T led the category with $787 million in 2000, a 9.2% increase that nearly propelled it past Chevrolet. Verizon, the merger of Bell Atlantic Corp. and GTE Corp., made the largest jump of any Top 10 advertiser, its spending ballooning 119% to $709.7 million.


Financial services advanced 26.9% in ad volume for 20 megabrands in the Top 200, with the Big 3 credit card megabrands-Visa, American Express and MasterCard-accounting for 29% of the total. Visa and AmEx played cat-and-mouse, tracking each other's spending as both finished the year at about $320 million.

Discount brokerages and online trading companies claimed much of the growth in ad spending by the financial services segment, an outgrowth of the bull market of the late '90s that produced a nation of stockholders who gravitated to online trading services for price and convenience. Discount brokerage megabrand Charles Schwab spent $235 million in 2000, up 23%. Ameritrade Online accelerated growth in its ad budget by 54%.

Drugs, lead category in growth at 37.5% for 10 drug megabrands, continued to hitch its growth to direct-to-consumer ethical drugs. Merck & Co.'s Vioxx osteoarthritis medication topped drug spenders at $160.8 million.

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