According to PricewaterhouseCoopers’ Global Entertainment and Media Outlook: 2010-2014, global entertainment and media spending is expected to rise from $1.3 trillion to $1.7 trillion by 2014, growing at a compound annual growth rate of 5.0%.  The US E&M market is expected to grow at 3.8% CAGR reaching $517 billion in 2014, from $428 billion in 2009. Fast changing consumer behavior is expected to be the catalyst of the entertainment and media industry change over the next five years,

Ken Sharkey, US leader, entertainment, media & communications practice, PricewaterhouseCoopers, notes that “… the digital pace of change has proven to be even quicker than anticipated with consumers embracing new media… and digital downloads at often-unexpected speeds… the continued fragmentation of the E&M sector will fuel greater experimentation by both established industry giants and niche players… ”

Digital services continue to be the primary growth engine, but traditional revenue streams are expected to remain significantly larger throughout the forecast period.  The industry will need to embrace digital not as a competitor to traditional services, but as a complement. Digital spending in the US is expected to account for 26% of all E&M spending in 2014, up from 19% in 2009.     

While there are signs of a rebound, advertising is unlikely to return to former levels. By 2014, the US advertising spend is expected to still be 9% below its level in 2007.  Overall US advertising is expected to increase at a 2.6 % CAGR from $159 billion in 2009 to $180 billion in 2014.  In the US, Internet advertising is expected to surpass newspaper advertising spend in 2010. 

Advertising spending for Internet, television, radio, out-of-home, and video games are expected to be larger in 2014 than in 2009, while consumer magazines, newspapers, directories and trade magazines are expected to be smaller. These projections reflect the market fragmentation and consumer behavioral changes. The advertising industry is responding to consumers’ shifting attention and migrating towards total marketing or total brand communication.  Brands are changing their focus from advertising on a medium, to marketing through, and with, content.  

Consumer feedback and usage provides the only reliable guide to the commercial viability of products and services, and the global consumer base is being used as a test-bed for new offerings and consumption models.  PwC has identified three themes that are expected to emerge from changing consumer behavior and the industry must anticipate and pre-empt the needs and wants of consumers.  

• Rising power of mobility and devices: Advances in technology are expected to see increasingly converged, multi-functional mobile devices come of age as a consumption platform by the end of 2011. By 2014, US mobile Internet access subscribers are projected to increase to 96.1 million, a 40% CAGR from 2009. 
• Growing dominance of Internet experience over all content consumption: Increasingly, the consumer has moved beyond thinking of the Internet as an end in itself, and expects all forms of media to embed the convenience, immediacy and interactivity of the Internet. People are already consuming magazines and newspapers on Internet-enabled tablets, and streaming personalized music services in preference to buying physical CDs.
• Increasing engagement and readiness to pay for content-driven by improved consumption experiences and convenience: Consumers are more willing to pay for content when accompanied by convenience and flexibility in usage, personalization and a differentiated experience that cannot be created elsewhere. Local relevance is also expected to enhance the content providers’ ability to charge.  

Digital migration and consumer behavior changes have put extreme pressure on existing business models.  The proliferation of platforms and rising consumer expectations mean companies can no longer ‘be everything.’

“The industry must radically rethink its approach to monetizing content in capturing new revenue sources, from transactions or from participation with others operating in the evolving digital value chain… ” added Ken Sharkey.   

Segment highlights In the US:

• Internet access and Internet advertising is expected to continue to outperform the other E&M segments, with 8.8 % and 7.7% CAGR, respectively 
• Video games (6.4% CAGR)
• TV subscriptions (6.5% CAGR)
• TV advertising (5.3% CAGR)
• Radio (4.6% CAGR),
• Filmed entertainment (3.6% CAGR)
• Out-of-home advertising (3.2% CAGR)
• Consumer and educational book publishing (2.5% CAGR)
• Business-to-business publishing (0.9% CAGR)
• Recorded music (-2.4 CAGR)
• Newspaper publishing (-2.8 CAGR)
• Consumer magazine publishing (-0.5 CAGR)

• Overall, US consumer/end-user spending is expected to grow by 3.7% CAGR

inserted from:

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Posted under Mobile, New Media, Newspaper, Online, Radio, Revenue, TV & Cable

Wednesday, May 26, 2010

3:56 PM

From MarketingCharts.com 

“Radio’s 7.4% increase outpaced overall gains in advertising expenditures in Q1”

Large Advertisers Boost Q1 Spending

The largest advertisers boosted spending significantly in the first quarter of 2010, according to new data from Kantar Media.

P&G Remains Biggest Spender

The top three advertisers increased spending significantly: Procter & Gamble spending jumped 17.7%, AT&T boosted spending 26.7%, and General Motors increased spending 28.5%, according to Kantar.

Procter & Gamble maintained its position as the largest advertiser, spending $772.6 million; budgets continued to shift toward magazines and away from television.

AT&T rose to the second spot with spending of $576.4 million, behind a large TV ad buy in the Winter Olympics. Rival Verizon (fourth-largest advertiser) reduced its total expenditures by 9.1%, to $517.2 million. Both telecom companies continued to allocate more resources to promote their TV service products as they try to win subscribers from cable and satellite operators. General Motors was the third largest advertiser, spending $533.7 million.

Pfizer, the fifth largest advertiser, posted the highest growth rate with expenditures up 46.2% to $396.4 million as the company maintained aggressive marketing support for Lipitor (prior to the brand going off patent in 2011).

Other Top Advertisers

6. News Corp spent $366.8 million (up 7.8%)

7. Johnson & Johnson spent $344.1 million (down 11.8%)

8. Time Warner spent $304.3 million (up 14.7%)

9. Disney spent $267.6 million (down 11.8%)

10. General Electric spent $264.6 million (up 1.3%)

Top Categories Increase Overall Expenditures

Of the top 10 spending categories in the first quarter, only one – direct response – fell, down by 3.2%. Overall, expenditures for the ten largest advertising categories rose 7.8% in the first quarter and totaled $17.95 billion.

Automotive was the leading category by dollar volume and also had the highest growth rate among the top 10, with spending up 18.6% to $3,016.8 million, ending a streak of 18 consecutive quarterly declines. Manufacturers and dealerships reacted quickly to an improving sales environment by ramping up marketing efforts with TV, magazines and radio being the main beneficiaries.

Telecom was the second largest category as expenditures reached $2,276.5 million, an increase of 10.6%. Financial services also experienced a revival, up 10.1% to $2,028.7 million. Sharply higher spending from marketers of credit cards and loan products offset continued weakness within the consumer banking segment.

Packaged goods categories, where advertisers took advantage of soft ad pricing in 2009 to bolster their media weight, were undaunted by rising ad prices in the first quarter of 2010. Spending from Food & Candy was up 7.3% to $1,600.0 million and expenditures for Personal Care Products increased by 5.5% to $1,311.5 million.

Restaurant category spending also turned around with modest growth of 3.1%, to $1.454.5 million. A major contributor to the gain was McDonald’s television sponsorship of the Winter Olympics.

Kantar reported that overall, ad spending climbed 5.1% in the first quarter.

Posted under Radio, Revenue, TV & Cable

From MediaPost Publications
By Eric Sass
September 17, 2009

The decline in newspaper ad revenues — now several years old — will continue for at least another year, according to Fitch Ratings, which issued the gloomy prediction in an overview of the media business released earlier this week.

According to Fitch’s “Credit Encylo-Media,” newspapers will not share in the recovery forecast for some other media in 2010, thanks to continuing downward trends in all three traditional mainstays of newspaper advertising: classifieds, local, and national ads. Read More…

Posted under Newspaper, Research, Revenue

From Media Life Magazine
By Louisa Ada Seltzer
June 3, 2009

Newspaper ad revenue plummets 28.3 percent

Newspaper ad revenue has declined each of the past three years, and it certainly doesn’t look like that will change this year. Papers suffered their worst decline in recorded history during first quarter, according to numbers put out by the Newspaper Association of America. Quarterly revenue plunged 28.3 percent compared to the same time last year, from $9.2 billion to $6.6 billion. The hurt was felt across print and online both, with the latter slipping 13.4 percent to just over $696 million, the steepest decline since the NAA began tracking web revenue in 2003. Print was off 29.7 percent, to $5.9 billion. Classified took the biggest hit, off 42.3 percent from last year. It follows the worst-ever quarterly decline for radio as well.

Posted under Newspaper, Revenue

From MediaPost Publications
By Erik Sass
May 14, 2009

Much attention has been focused on the decline of major American newspapers, and it’s common knowledge that print advertising revenues have plunged over the last couple of years. But exactly how much money have newspapers lost in their print operations? An estimated $18.7 billion from 2006-2008. Read More…

Posted under Newspaper, Revenue

From: Radio Business Report
By: Jim Carnegie, Editor & Publisher
May 8, 2009

Radio, TV stations drove $805 million in online dollars

According to new research from BIA Advisory Services broadcasters are showing signs of progress by developing Internet revenue for their stations. BIA estimates radio and televisions stations collectively drove some $805 million in online dollars, equal to 7.3% of the $11 billion local online ad money spent in 2008.

Posted under Radio, Research, Revenue

From Media Post Publications
By Eric Sass
April 8, 2009

The economy be damned. Online radio is still going strong, according to “Infinite Dial 2009,” Arbitron’s latest overview of the medium, due out later this week. The news follows a series of deals confirming that whatever happens in the economy at large, online radio is rapidly carving out a niche for itself in the digital media landscape.

And it’s a sizeable niche. 42 million Americans over the age of 12 listen to radio during an average week, more than double the 2005 figure of 20 million, and up 27% from 33 million in 2008. That means online radio currently reaches about 17% of Americans over the age of 12, up from about 8% in 2005 and 13% in 2008. These figures are based on data collected and analyzed by Arbitron and Edison Research. Read More…

Posted under Online, Radio, Research, Revenue

From The New York Times
By Tim Arango
December 28, 2008

Did you hear what Howard Stern said the other day? Neither did we. But we read about it on a blog.

Mr. Stern, the ribald radio jock who once commanded attention with each off-color utterance and obscene joke, mused recently on the air that he was thinking of retiring when his contract expires in two years. “This is my swan song,” he said.

Back in the day when Mr. Stern was on free radio and had an audience of 12 million, that remark would have cascaded through the media universe. But by switching to satellite radio three years ago, Mr. Stern swapped cultural cachet for big money. Read More…

Posted under Radio, Research, Revenue, Satellite Radio

From Media Buyer Planner
October 21, 2008

The 14-24 demo is increasing its time spent listening to radio and decreasing time spent listening to iPods, according to a new study from Paragon Research.

Time spent listening to radio among 14- to 24-year-olds has increased by 11% this year, while time spent listening to iPods has slipped by 13%, per the study (via AdAge). The article points out that the study corresponds with the RAB’s annual RADAR report, which shows that AM/FM listeners increased by 3 million, to a total of 235 million weekly listeners, in 2008. Read More…

Posted under Newspaper, Radio, Research, Revenue

From Advertising Age – MediaWorks
By Jeremy Mullman
August 18, 2008

Tribune, Scripps and Lee Report Declining Online Revenue

CHICAGO (AdAge.com) — File this under “It can always get worse.” Amid the constant stream of circulation declines, vanishing ads and staff reductions that have afflicted print newspapers, some major publishers are seeing online-revenue declines for the first time. Read More…

Posted under Newspaper, Online, Revenue