Ad Spending Up 5.6% in 1Q

Advertising spending through the first quarter of 2006 rose 5.6 percent over the same period last year, due to gains across major media, according to Nielsen Monitor-Plus research.

Advertising spending increased in almost all reported media, led by Internet, Spanish-Language TV and Outdoor. The 2006 Winter Olympics in the first quarter contributed to the increase in Network TV spending, as nearly 1.1 billion dollars was spent during the games. A number of media showed healthy increases, while Coupon, Local Newspaper and Network Radio experienced slight declines. Business-to-Business magazine and Cable TV growth was almost flat.

Advertising through the first quarter for the top 10 companies reached $4.6 billion, up 11.4 percent compared to the same time last year. AT&T, Verizon Communications and General Electric had significant increases in year over year spending, up 76.5 percent, 46.1 percent and 54.4 percent, respectively. Most of AT&T’s spending was attributed to Internet Service and General Image campaigning, while Verizon increased dollars to its V-Cast Wireless Services and Business Services. General Electric increased spending for Universal Pictures and Universal Studios, as well as GE Healthcare.

Spending for the 10 largest categories reached $10.5 billion throughout the first half of 2006, 6.1 percent greater than the same period last year. Almost all product categories experienced healthy gains in spending, with the exception of local automotive dealerships and direct response products, which are slightly down. The restaurant industry continues to be the fastest growing in terms of percent increase over last year, followed by credit card services, with an increase of 22.7 percent and 22 percent, respectively. Spending within the restaurant category was up overall, while increased spending by Visa, American Express and JP Morgan Chase drove the increase in the credit card category.

The top 10 brands in the product placement category totaled 4,371 occurrences through the first quarter of the year. Coca-Cola accounted for more than half of the total with 2,551 occurrences. Nike brands accounted for two of the top ten brands, for its apparel and sports footwear lines.

The top 10 programs that featured product placements in the first half accounted for 8,793 occurrences. American Idol had a significant number of product placement occurrences, making it the number one program. In fact, the program had more than triple the number of product placements compared with the number two program, The Biggest Loser, with 3,052 and 945 occurrences, respectively. A majority of the occurrences placed during American Idol were for Coca-Cola soft drinks, with a total of 2,510. This accounted for nearly all of Coca-Cola’s occurrences during Quarter 1, 2006.