U.S. Advertising Spending Rose 8.3% In The First Three Quarters of 2004.

Advertising spending for the first three quarters 2004 rose 8.3% over the same period last year, due to gains across major media, according to preliminary figures released today by Nielsen Monitor-Plus, the advertising intelligence service of Nielsen Media Research.

The pace of ad spending in 2004 continues to escalate. First-half spending grew at a rate of 6%, while third quarter rose 11%, resulting in an overall gain of 8.3% through the end of the third quarter. “Ad spending has consistently grown with each quarter in 2004. This is very encouraging and suggests a strong total-year gain,” said Jeff King, managing director of Nielsen Monitor-Plus. “The Summer Olympics, with total spending reaching over $1.8 billion, contributed to much of Network and Cable’s increase, while Spot TV was helped by Political advertising.

Through September, Automotive advertising experienced the largest dollar increase, with the Prescription Drug and Quick Service Restaurant categories following. These three categories contributed to an overall increase of $1.25 billion compared to same period last year.”

Advertising spending increased in almost all reported media, led by television and print. Included for the first time in this analysis, Monitor-Plus reports spending on over 800 trade publications.

Year-to-date advertising spending for the top 10 companies topped $12 billion, up 12.7% from last year. Nearly every advertiser experienced growth, with P&G leading in terms of dollars, and the Big Three automotive companies also showing great increases in advertising expenditures: DaimlerChrysler (+40.9%), General Motors (+22.6%), Ford Motor (+9.4%).

As larger vehicles continue to maintain popularity, DaimlerChrysler considerably increased ad budgets for several of its trucks/vans, including Chrysler Town & Country Vans, Jeep Grand Cherokee, and Mercedes-Benz G-Class Trucks. SBC Communications, which had the second largest percentage growth (24.7%), increased spending for their wireless telephone service brands like AT&T and Cingular.

Category Spending

Spending for the 10 largest categories reached over $28 billion for the first three quarters, nearly 8% greater than the same period last year. Combined spending for the three Automotive categories (Factory, Local Dealerships, Dealer Associations) reached $13 billion, for a net increase of $478 million (3.8%). The Pharmaceutical category, which is the fastest growing in terms of percent increase (30.2%), continues to increase spending, exceeding three billion dollars.

Political Spending

Spot and National Cable television experienced a large increase of political advertising in 2004, with over one million commercial occurrences airing across the U.S., up to the time of the election. The chart below details the largest Presidential campaign advertisers. Advertising support on TV for Senator Kerry was actually much greater than the 39,863 difference between the two candidates’ campaigns, when interest group funding is taken into account. In total, ads supporting President Bush totaled 407,629, while Senator Kerry’s support amounted to 601,348 (47% more).

Ken Goldstein, director of the University of Wisconsin Advertising Project, observes, “Consistent with the overall discipline of the Bush campaign, Bush advertising was narrowly focused on two issues: terrorism and taxes. The Bush campaign was disciplined in their message, and also disciplined about being negative on John Kerry. The Kerry campaign, however, talked about a much more broad set of issues: healthcare, education, taxes, jobs, economy, and Iraq.”

The chart below lists the Top 15 groups that have placed the most political advertising on local radio up to the time of the election (over 500 commercials each), according to the AirCheck service from Media Monitors in New York. The data reflects radio advertising in 20 of the top markets in the U.S. The largest advertiser, Re-Elect George W. Bush for President, placed almost twice the number of spots than that of the number two advertiser, John Kerry for President. While Kerry outspent Bush in television, this radio data illustrates a slightly different picture.

Product Placement

Our Product Placement tracking service noted continued growth in the integration of product occurrences in primetime network programming, with the Top 10 brands in the product placement category totaling 8,145 occurrences in the first nine months of the year. The number one brand, Coca-Cola Classic, had more than double the number of occurrences than the number two brand, Pepsi (2,245 and 1,109, respectively). The top 10 programs that featured product placements accounted for 18,454 brand occurrences. American Idol tops the list, largely due to the program’s relationship with Coca-Cola. Other reality programs that feature frequent brand occurrences include The Apprentice, Pepsi Smash, and Big Brother 5.

To view charts CLICK above on ‘More Images’.