Kantar Media 3Q Ad Revenue Declines 1.9 Percent

Total advertising expenditures in the third quarter of 2013 declined 1.9 percent from a year ago and finished the period at $34.0 billion, according to data released today by Kantar Media, the leading provider of strategic advertising and marketing information. For the year-to-date period of January through September, total spending increased 0.7 percent to $102.5 billion.

Jon Swallen

“Comparisons against Q3 of 2012 are skewed by last year’s record-breaking Summer Olympic and political campaign ad spending, which artificially boosted the market,” said Jon Swallen, Chief Research Officer at Kantar Media North America. “Remove that incremental money from the year-ago base and spending in Q3 2013 was up 2.5 to 3.0 percent. This is more indicative of how the ad market is currently performing.”

Measured Ad Spending By Media

• Without the benefit of an Olympics event, Network TV expenditures in the third quarter fell 17.9 percent compared to a year ago. Spot TV dropped 15.0 percent, primarily due to the reduction in political category spending that occurs in odd-numbered years. Other television segments had healthy gains in Q3. Spanish Language TV ad expenditures rose 9.9 percent, principally from more hours of soccer programming on Hispanic networks. Spending on Cable TV networks was up 5.1 percent and continues to be lifted by a creeping expansion of ad time.

• Spending for Internet display advertising, which does not include video or mobile ad formats, grew 14.5 percent in the quarter on broad gains from the financial service, telecom and technology categories. Outdoor advertising expenditures rose 5.5 percent, the sixteenth consecutive quarter of year-over-year increases. The medium is benefitting from digital signage, which allows multiple advertisers to share a single space and enables operators to command higher prices.

• Magazine media had mixed results in the third quarter, depending on the segment. On the positive side, Consumer Magazine expenditures increased 5.5 percent on higher activity from consumer package goods and apparel marketers. Ad pages grew a scant 0.3 percent. On the down side, spending in Sunday Magazines declined 4.0 percent, but this is explained by a calendar quirk: there were thirteen Sundays in Q3 2013 as compared to fourteen the prior year. Meanwhile, B-to-B Magazines (-0.7 percent) and Local Magazines (-0.1 percent) each fell by a small amount.\

• Radio media also experienced mixed results for the quarter. Local Radio, despite the headwinds from lower political ad spending, eked out only a 0.4 percent gain in total expenditures. Spending on National Spot Radio fell 8.5 percent on cutbacks by restaurant, retail and financial service advertisers. Network Radio expenditures plunged 23.7 percent, but the decline was exaggerated by a reduction in radio programming tracked by Kantar Media.

• The persistent and steady contraction of Newspaper media continued in Q3 of 2013. Expenditures in Local Newspapers dropped 3.2 percent and National Newspapers were down 6.4 percent on commensurate declines in the volume of ad space sold, indicating weak demand. For both segments the spending reductions were led by the automotive, retail and financial service categories.