The media and advertising markets remain fairly ‘challenging’ at present, with little good visibility beyond the end of the year in the UK. In the States, recent figures have been a bit more positive, with Q3 data and forecasts both indicating an upturn.
US third quarter adspend rose by 3.8% overall, according to
Nielsen Monitor-Plus. Eight of the 11 categories measured by Nielsen reported increases in revenue, most notably local newspapers, up 9.5%. Internet spend remains on the weak side but is improving. Separate figures for the first three quarters of the year from
CMR showed growth at 2.2% year on year.
However, despite the improving figures, optimism is not unanimous. Whilst Merrill Lynch sees more confidence in the news coming from the major advertising groups, Lehman Brothers remains less convinced.
Following a small survey of budget revision intentions, Merrill’s confidence in the sector was bolstered slightly and it now predicts that US spend will grow by 4% in 2003. A separate report from Global Insight forecasts that 2003 US adspend will rise by 6.0%, following a 2.8% rise this year.
Lehman Brothers, meanwhile, says that the outlook for European and US advertising remains largely gloomy, despite some more promising signs from the bigger networks. The top five global ad agency groups have reported their Q3 results, which contained a few more positive indicators – organic growth up on Q2 and some stabilising of the US market – but Lehman says that the outlook was generally quite poor. Analysts believe that the balance of risk for 2003 forecasts remains on the downside.
UK data Forecasts from ABN AMRO put UK adspend growth at 0.2% this year, rising to 3.0% and 4.9% in the next two years, outperforming the global average.
Financial results from Carlton Communications indicate that its revenues may be up 2% in the financial first quarter, although there is little visibility beyond that. Granada said that there would be a 2% rise in revenues for the October-December period, but would not speculate any further ahead than that.
The picture was very similar at Daily Mail & General Trust, with its Associated Newspapers division expected to see revenues rise 5% in October/November, following a 9.6% decline in the year to September. Again, there is little visibility beyond that.
The radio markets remain tough, with Capital Radio and UBC Media both suffering, whilst Chrysalis Radio out-performs the market. Nevertheless, UK commercial revenue growth for Q3 beat analysts’ expectations by turning in a 3.2% growth.
Figures from the Outdoor Advertising Association report that UK outdoor spend rose by 5.1% in Q3 2002. This was described as a ‘steady, rather than rocketing’ improvement and a stronger upswing is not anticipated for at least another twelve months.
