A last minute rush by advertisers to buy television airtime is currently taking place in the US, as marketers attempt to make the most of improving consumer confidence and spending predictions with pre-Christmas promotions.
According to an analysis by
Jack Myers Report, advertisers are off-loading remaining budget that had previously been put on the side following the attacks of 11 September. Improving consumer conditions, as well as the fact that if budgets are not spent now, in 2002 they will be lowered accordingly, are leading marketers to buy up inventory in the last minute ‘scatter market’, says Myers.
“This late spending surge is benefiting CBS, Fox and UPN, which have experienced strong fourth quarter ratings … Several cable networks are experiencing strong December sales, ending this dismal year on a positive note,” says the report.
However, Myers warns against seeing this upturn as indicative of a ‘sustained market turnaround’. “The media recession will continue throughout the first three quarters of 2002 and could extend into mid-2003, depending on general economic conditions and global war-time politics and continued terrorist threats,” he says.
As a result there will be a harsh reality check come January, when ad levels once again fall away. Marketers are likely to take a cautious ‘wait and see’ approach as they move into a very uncertain 2002.
The outlook is not rosy: “The telecommunications sector remains deflated; travel and tourism will be extremely cautious; there are very few new product launches in the pharmaceuticals category. The first quarter is typically slow for entertainment. Historically, first quarter media spending is well below fourth and second quarter levels, so some sellers are already pacing ahead for the second quarter while having very little first quarter revenues on the books.”
Myers predicts that given the difficult economic conditions and the effects of the continuing military action, marketers are likely to shift towards the most flexible media, namely radio and newspapers. “Both television and magazines have long lead-times for commercial/advertising development, production and placement,” says Myers.
