B-to-b ad spending registers first decline in a decade

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New York--B-to-b media advertising spending plunged 19.7% in 2001 to $10.8 billion, making it the hardest hit media segment, according to Veronis Suhler Stevenson's "Communications Industry Forecast," released Monday.

The media merchant bank's finding was not surprising, given the visible casualties in the sector, such as Ziff Davis Media, which is currently racing the clock to garner board approval for its restructuring and avoid a Chapter 11 bankruptcy filing.

Total b-to-b spending decreased 12.7% to $13 billion. The 2001 decrease marks the sector's first in at least a decade, according to Veronis Suhler. The company compiles its figures from various primary sources, including AdScope, Business Information Network, BPA International and Competitive Media Reporting. The precipitous drop in advertising spending was attributed primarily to a double-digit drop in technology ad spending, as well as a decline in the insurance-financial-legal services category.

Veronis Suhler predicts spending on b-to-b media advertising will decline again this year, by 11.7% to $9.6 billion, and that it will begin to increase (4.9%) in 2003. B-to-b traditionally lags behind consumer media and the overall economy by six to 12 months, according to Veronis Suhler. The b-to-b promotion sector also took a beating in 2001, down 10.4% overall.

--Carol Krol

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