Figures for July show that broadcast advertising is picking up in the US and prospects for 2004 are even brighter with political and sporting events likely to act as a springboard.
At its recent annual forecasting conference, the Television Bureau of Advertising re-iterated that spot TV advertising would increase by 1-3% this year with growth likely to be at the low end of this range (see
2004 To Be A Banner Year For TV Advertising). However, even this would be something of an achievement given the tough conditions of the first half.
The threat of war and the uncertain economic climate deterred many advertisers in the early months of 2003 and broadcast TV revenues were up by just 2.1% in the six months to June, according to the TVB (see US Television Revenues Nudge Up 2.1% In H1).
Other assessments are even less encouraging with Nielsen Monitor-Plus claiming that network TV ad spending fell by 3.5% in the first seven months of 2002. However, closer inspection reveals that revenues were up 3.2% in July, thanks in part to an 8.1% rise in spot advertising (see Advertisers Switching Back To Spot TV).
Statistics reveal that advertisers buying network TV increased by 0.7% that month. This is encouraging given that the number using the medium in the year to that point was down 5.1%.
Mediapost analysis of Nielsen data also shows that average unit rates are climbing. The average cost per 30-second spot on the major broadcast networks rose 10.7% year on year in July and was up 3.9% over a seven month period.
These increases should be put in the context of the general economic revival. The National Association for Business Economists is forecasting a 4.5% annualised GDP increase in the third quarter of 2003, then 4% in the fourth.
In advertising terms, the US presidential election and the Athens Olympics are the two major forthcoming events and with the NABE predicting a 2.6% GDP rise this year, followed by 4% growth in 2004, there is plenty of cause for optimism.
The TVB anticipates that spot TV revenues will grow 10-11% next year and while Merrill Lynch is more cautious, predicting a 6.2% increase, it is clear that the recovery is well and truly underway.
