US advertising spend is predicted to rise by 2.5% to $109.1 billion dollars in 2002, according to CMR chief executive officer, David Peeler.
Speaking at conference yesterday, Peeler said that the second half of the year could see a 6.2% jump in adspend, led by political advertising during the mid-term elections. The 2.5% full year growth is still down on 2000’s spend (by 6.7%), but is a slight increase over 2000, which suggests a return to normal growth rates.
CMR estimates that total adspend for H1 2002 will show a 0.4% rise year on year. There is expected to be stronger growth in Q3 and Q4, but this is nevertheless being compared to the particularly weak levels of this period during 2001.
The better than expected TV upfront markets in the US (see US Upfronts Outpace Even Most Bullish Expectations, Says Myers) are already beginning to indicate a return of confidence from some advertisers, he said. However, some commentators have argued that the boost in spend is more a result of declining audiences than it is the beginning of a certified recovery (see Advertising Outlook Remains Unclear).
As TV audiences in the US are falling, advertisers are forced to spend more in order to achieve certain coverage. This results in an increase in costs per thousand (CPT, or CMP in the US). The broadcast networks saw their CPM rise by 8-10% during the upfront markets; pre-upfront forecasts had expected gains of just 2-5%.
