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Ad Spending in Q1 Rises 5.7%

June 24, 2014

Olympics fuel sector overall, but P&G and L'Oréal cuts impact consumer print.

Aided by the Winter Olympics, total advertising expenditures increased 5.7% in the first quarter of 2014 to $34.9 billion, according to data released today by Kantar Media.
“The Winter Olympics delivered its expected windfall in the first quarter, adding about $600 million of incremental ad spending to the marketplace. But the nature of the event is that this money is narrowly distributed and doesn’t benefit all sectors of the market,” said Jon Swallen, chief research officer at Kantar Media North America. “Subtracting the Olympics’ contribution, the growth rate for remaining expenditures was just under four percent.”
Every measured type of television had expenditure increases in Q1. Network TV increased 14.5% with about one-half of this growth coming from the Winter Olympics. Higher spending on the NFL playoffs and Super Bowl also contributed to the gains.
Internet display expenditures grew 13.0% in the first quarter as financial, retail and insurance marketers raised their budgets. Outdoor media registered a 2.8% increase, noted Kantar.
However, consumer magazine print expenditures fell 2.0% and the key metric of ad pages declined more than five percent. The bottom line totals were skewed by severe reductions from the two largest magazine advertisers—Procter & Gamble and L’Oréal—who account for more than 10% of total spending.  
In Q1 P&G’s overall ad spending was $773.8 million, down 2.6% from the prior year. Increased support for personal care and paper product brands was more than offset by reductions within its cosmetics and hair care brand portfolios, according to Kantar.
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