Nielsen: U.S. advertising spending down .6% in Q1 2007 … Hispanic bright spot.

Advertising spending for the first quarter of 2007 was down slightly at 0.6% over the same period last year, according to preliminary figures released by Nielsen Monitor-Plus.

Advertising spending was mixed across media with gains in some categories and declines in others. Internet advertising continues to grow steadily with an increase of 31.9% in the first three months. National Magazines (6.5%), Spanish-Language Television (4.0%) and Spot TV Markets 101-210 (4.1%) also reported growth, while Network TV dropped by 8.5% this quarter compared to the same time period last year.

“Spanish-Language TV advertising spend continues to show growth, not that surprising with the increasing emphasis on targeted marketing. Last year’s Torino Olympics in February 2006 contributed to a higher than typical first quarter, resulting in a decline in TV ad spend for Q1 2007. If you removed the Olympics’ ad spend from the Network numbers last year, those numbers would actually be up this quarter,” said Brian Lane, Senior Vice President of Client Strategy & Product Development for Nielsen Monitor-Plus.

Advertiser Spending

Advertising spending for the top 10 companies for the first quarter 2007 reached $4 billion, down 15% from the same time period in 2006. Nine of the 10 advertisers decreased budgets – DaimlerChrysler was the only exception at a modest 3.3% growth. The largest decline (-35.8%) came from General Motors, who cut significantly cut ad spending for many truck brands, including GMC Yukon, Chevrolet Tahoe, Hummer H3, and GMC Sierra. Ford Motor Co., the third automotive company on the list, was essentially flat, with a slight decrease of 1.8%.

Category Spending

Spending for the 10 largest categories reached $9.8 billion in the first quarter of this year, 8.2% less than the same period last year. Most product categories have decreased spending, with the exception of Direct Response Products (plus 8.8%), Pharmaceutical (plus 7.2%), and Wireless Telephone Services (plus 4.6%). Companies that contributed to the increase in these product categories include Lexicon Marketing, Bose, Pfizer, Takeda, AT&T, and Alltel.

Product Placement

Nielsen Product Placement Service reports an increased number of product placement occurrences in prime-time broadcast network programming for Q1 2007, based on its Top 10 Programs ranking. The Top 10 programs featured 8,893 occurrences compared to 8,793 occurrences for the same time period last year. “American Idol” is once again the leader in terms of the number of product placements. For Q1 2007, American Idol featured 3,113 occurrences vs. 3,052 occurrences in Q1 2006. The Apprentice surged to fourth place with 945 occurrences, compared to last year when the program ranked seventh overall with 607 occurrences.

The Top 10 brands that featured product placements for Q1 2007 accounted for 4,253 occurrences. A slight drop compared to last year, when 4,371 brands were reported. Coca-Cola, associated with “American Idol,” was the top brand once again, with 2,488 occurrences this year. The Pussycat Dolls Lounge Nightclubs placed second in terms of the brand with the most occurrences (376). The brand is directly linked to the show “The Pussycat Dolls Present” airing on the CW, and places in the top 5 among programs with the most product placement occurrences. The Boston Red-Sox Baseball Team brand had 232 occurrences, a result of an “Amazing Race All Stars” contestant called Boston Rob, who wore Red-Sox related apparel on the show.

“The top 10 programs for product placement this quarter represent nearly half of the activity we tracked on English language broadcast networks. Although we see substantial upwards trends with drama programs engaged in product placement, reality and lifestyle shows continue to dominate our Top 10 rankings,” said Annie Touliatos, Director, Product Development & Marketing for Nielsen Product Placement Service.

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