TNS Media: U.S. Ad Expenditures Continue To Drop in Q1

Spending is down 14.2% from Q1 2008

The descent rate of U.S. ad expenditures continued to accelerate in the first quarter, down 14.2%, or more than $5 billion--from $35.2 billion in Q1 2008--to $30.18 billion in the first quarter of this year, according to TNS Media. That was on top of a 9.2% drop in the fourth quarter of 2008.

Meanwhile, TV is trying to get creative with its marketing, filling non-ad time with lots of plugs and placements, according to the latest TNS branding study.

Local media was hit hardest by the the plummeting ad dollars, with spot TV the hardest hit of all, down 27.5% in the quarter compared to Q1 2008. Local newspapers recorded a 25.1% drop in advertising, and local radio was down 26.8%. As a group, the drop was 25.4%.

Not helping that local picture was the free-fall of auto dealership advertising, a staple of local TV, which was down a staggering 48.9%.

National ad spending was down 8.5% from the comparable quarter in 2008, with television doing far better than print. In fact, there was even a black figure among the red. Syndication was actually up two-tenths of a percent.

Network TV was down 4.2% and cable TV was down 2.7%. Newspapers led print decliners, down 28.5%.

The decline among the top 10 advertisers was 5.7% to $4.019 billion, with the "long tail" of small advertisers pulling down the average. Spending among the last one-fifth of advertisers among the top 100 were down 22.3%.

The top advertisers, Procter & Gamble, cut its advertising by 17.8% in the quarter, though that still made it the top advertiser. The average was helped by phone companies Verizon and Sprint Nextel as well as NBC parent GE and Johnson & Johnson, all of which spent more in the quarter than in Q4 2008.
According to TNS, branded entertainment--plugs and product placement--now account for 10 minutes: 35 seconds of an average prime time show. Combined with an average of 13:54 of ads, that means 41% of a prime time hour is marketing content.

Skewing the brand average are reality shows, which averaged 19:16 minutes per hour--which combined with the ad spots make them consist of more marketing than not. Topping the list was The Biggest Loser, which weighed in at 48:05 of brand appearances time, which would seem to even stretch somehow into the normal commercial load of 13:54, seemingly suggesting that every moment of the show was a plug.

But that wasn't quite the case. TNS counts the total mass of and volume of brand appearances, which means that it totals the time for concurrent appearances by multiple brands, meaning that there is some double counting of time.

Letterman, Leno and Kimmel together averaged 29:40 brand per show of marketing. combining brand appearances and ads, which also made them more marketing than not, according to TNS.

For the branded figures, TNS includes network ads, station promotions and public service annoucements, but not local commercial time.