Field Reports
DR Spending Outdistances
General Ad Market Growth
TNS Media Intelligence says DR’s 17-percent jump
helps overall market avoid a slide.
By Thomas Haire ( thaire@questex.com) and
Jacqueline Renfrow ( jrenfrow@questex.com)
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NEW YORK — While the U.S. advertising market finished 2007 with measured spending of about $149 billion, a
miniscule rise from 2006 — according
to data released by TNS Media Intelligence’s Broadcast Verification Services
(BVS), a provider of strategic advertising and marketing information, and a
research partner of Response Magazine
— the direct response category boasted
the largest growth of any measured category. Overall, direct response spending rose 17 percent to more than $7.8
billion in 2007.
“Direct response experienced the
largest gain among
the top advertising
categories, with a 17-
percent increase in
2007,” says Richard
Radzik, vice president,
BVS. “This growth is
particularly remarkable, as the overall
U.S. advertising market grew a tepid 0.2 percent for in
2007. Direct response’s healthy growth
was fueled by significant spending in
the ‘Household, Furniture and Appliances,’ ‘Drug and Toiletry,’ and ‘Crafts
and Hobbies’ industries. Looking at advertising spending across the different
media, TV continues to attract the
lion’s share of DR spending, with 49-
percent growth between 2005 and
2007.”
The short-form DRTV market
(TNS does not measure the long-form
market) grew a stunning 37 percent
alone from 2006 to 2007 (see page 26
for Response’s breakdown of TNS’ 4Q
2007 results) and finished just short of
$4.5 billion. Direct response in print,
online and on the radio combined for
the remaining $3.3 billion measured —
with DR print in magazines accounting
for nearly $2.6 billion of that total.
Internet display advertising ranked
second behind direct response in per-
centage growth, increasing almost 16
percent in 2007 to more than $11.3
billion, according to TNS’ data. Next
were consumer magazines, which
showed a 7-percent gain to $24.4 bil-
lion, followed closely by cable TV,
which was up 6. 5 percent (due to a
surge in the second half) and finished
at nearly $15.6 billion. Finishing fifth
was outdoor advertising, up about 5
percent to a touch
more than $4 billion.
“The [overall] ad
market remains
stalled and is being
engulfed by the
spreading pessimism
about general eco-
nomic conditions,”
says Jon Swallen,
senior vice president of research at
TNS Media Intelligence. “
Fourth-quarter performance was indicative of
this malaise and early figures from
2008 suggest the growth rate for measured ad spending has not appreciably
changed.”
Swallen attributes the low growth
rate to concerns about consumer spending and corporate profits. However, he
says he’s still hopeful that there will be
a boost in ad sales around the elections
and Olympics. The top 10 advertisers
of 2007 spent a combined total of nearly $18.7 billion in measured media,
down 0.3 percent from 2006. However,
the largest advertiser of the year, Procter & Gamble, was up 5. 6 percent and
spent $3.5 billion.
