Source: www.insideradio.com, November 2022
Six advertising category groups grew their national media spend in October, while the remaining six tightened the purse strings, according to Standard Media Index. Importantly four category groups – Pharma, Restaurants, Apparel & Accessories and Travel – experienced the best October on record, tracking back to 2017.
Technology took the largest hit in October, pulling back investment by nearly $400 million. “Steady declines began chipping away at overall spending in April 2022 with the heaviest fallout coming from Telecom,” SMI says in its October media investment recap.
Consumer packaged goods led all categories with a 12% year-over-year boost in ad spending. CPG corralled an 18% share of spending in October. Pharma, which boosted its outlay by 13% for a second consecutive up trend, was No. 2 with a 13% share. The Technology sector came in third place, albeit with a 29% pullback in spending compared to October 2020. Technology was in a three-way tie with Entertainment & Media (down 14%) and Financial Services (down 8%) each roping an 11% share of national ad investment in October, per SMI.
Like the prior two months, Automotive continued ramping up investment with the second highest lift in ad spend (+21%). Auto ranked sixth with a 10% share. The slow rebound in the category is being felt by radio broadcasters. As Inside Radio reported last week, Audacy (+6% year-over-year), Urban One (+57.3%) and Cumulus (up with no specifics given) all reported gains in auto ad sales during the third quarter. But the upticks weren’t widespread. Auto was down 5.5% at Beasley, dipped 3% at Entravision’s radio division and was Townsquare’s weakest category.
Back to SMI’s October report, Retail (-6%), Restaurant (+1%) General Business (-5%) and Travel (+9%) rounded out the top spending ad categories.
SMI figures are based on actual spend data from major agencies and independents and their clients and weighted to adjust for agencies and advertisers not represented. As such they exclude local ad sales, which make up the majority of radio revenues.
October’s 3.2% ad spend decline marked a fifth straight down month for the U.S. ad economy, according to SMI. While that’s a slightly lower rate of decline compared to August (-3.3%) and September (-3.6%), it’s still significantly off from a year ago, when spend was up 8.2% vs. 2020’s COVID-impacted ad activity.
