Citigroup : Advertising Agencies have not collapsed - yet
March 18, 2008
CHICAGO (MarketWatch) — A leading advertising agency echoes the notion that there hasn’t been a recession-related decrease in ad spending so far this year, an analyst said Tuesday. Discussions with two executives from the ad agency Initiative Media (IPG The Interpublic Group of Companies, Inc, according to Citigroup’s Catriona Fallon, revealed that advertising budgets are likely to be up by 3% to 5% for 2008 “with no pullback yet evident.” Some $2 billion to $3 billion is expected to come from election-related ads, while an unspecified amount will come from the Summer Olympics telecasts, Fallon quoted the executives as saying.
For 2009, however, ad spending is expected to be about flat, the analyst said, with early signs of the slowdown perhaps showing up this May — when advertisers buy commercial time for the fall-TV season.
“If we do see a pullback later in the year, it would come from more traditional advertising — especially preprint and broadcast-TV advertising, and less from digital spend,” Fallon wrote her note to clients. In a weakened economy, she added, local online-search advertising will decrease before that of larger companies
Fallon thinks that search marketing will crash before quarter million dollar full page ads in US news and world report will? How’s Citibank’s stock trading?
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