ADVERTISING SPENDING

Ad spending declines for the fifth consecutive month in US market

By our News Team | 2022

But the silver lining is that October outperformed all other months so far in 2022. Digital, OOH and newspapers are among categories that grew.

Advertising spending in the US market continued its decline for the fifth consecutive month, down 3% year-over-year for the month of October. This is according to Standard Media Index’s October 2022 Core Data report.

Notably, while Google topped media revenue across all channels, October 2022 proved to be the first time on record that its ad revenue took a downturn.

Advertising Spending

Image by Firmbee from Pixabay

But the good news – if there is any ‘good news’ in five consecutive months of decline in ad spend in the all-important US market – is that October outperformed all other months so far in 2022, including recording a 5% growth in digital ad spend.

Some categories had best month since 2017 

And four category groups – travel, restaurants, pharmaceuticals, and apparel & accessories – experienced their best October for advertising spending since 2017. The automotive and consumer packaged goods (CPG) categories also increased their ad spending.

The remaining six categories – technology, entertainment & media, financial services, general business, retail, and wellness – showed year-over-year declines. Technology took the largest hit, with investment in advertising down nearly US$400-million compared to the same period in 2021.

“Although the market is down compared to last year, Standard Media Index (SMI) sees this less as recessionary fears, and more as the ad sector normalising from an overly hot [previous] year. In the last months of 2021 and even Jan-Feb 2022, advertisers were spending [approximately] 20% [more versus] 2020, whereas ‘normal’ ad market growth for [previous] decades was in the 2-5% realm,” the researchers said.

Other notable highlights of the report included:

  • Linear TV (when a viewer watches a scheduled TV programme when it airs on its original channel) spending deflated at the fastest rate, while Digital expanded, gaining 5% points to represent a 57% share of ad dollars in October.
  • Out-of-Home media grew most rapidly. Nine out of 12 Product Category Groups beefed up spending. Entertainment & Media, Apparel & Accessories, and Auto sectors led the pack in raising investment levels in support of OOH.
  • Surprisingly, newspaper investment also expanded, breaking four consecutive years of divestment in the category.

Analysing the latest figures, the industry publication Marketing Dive noted: “SMI’s findings for October provide some optimism for [the] advertising industry. While five straight months of ad spending declines are nothing to cheer about, the fact that those declines are slowing, particularly heading into the holiday season, does offer some silver lining.”

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    Dr Kin Kariisa

    Group CEO - Next Media

    Dr. Kin Kariisa is an extraordinary force at the helm of Next Media Services, a conglomerate encompassing NBS TV, Nile Post, Sanyuka TV, Next Radio, Salam TV, Next Communication, Next Productions, and an array of other influential enterprises. His dynamic role as Chief Executive Officer exemplifies his unwavering commitment to shaping media, business, and community landscapes.
    With an esteemed academic journey, Dr. Kariisa’s accolades include an Honorary PhD in exemplary community service from the United Graduate College inTexas, an MBA from United States International University in Nairobi, Kenya, a Master’s degree in Computer Engineering from Huazong University in China, and a Bachelor’s degree in Statistics from Makerere University.
    Dr. Kariisa pursued PhD research in Computer Security and Identity Management at Security of Systems Group, Radboud University in Nijmegen, Netherlands. As a dynamic educator, he has shared his expertise as a lecturer of e-Government and Information Security at both Makerere University and Radboud University.

    Dr Kin did his PhD research in Computer Security and Identity Management at Security of Systems Group, Radbond University in Nigmegen, Netherlands. He previously served as a lecturer of e-Government and Information Security at Makerere University in Kampala, Uganda and Radbond University in Netherlands.

    Dr Kin did his postgraduate courses in Strategic Business Management, Strategic Leadership Communication and Strategies for Leading Successful Change Initiatives at Harvard University, Boston USA.

    • Other current and previous roles played by Dr Kin Kariisa:
    • Lecturer of e-Government and Information Security to graduate students at Makerere University, Kampala and Radbond University in the Netherlands
    • Director of Eco Bank Uganda Limited, one of the largest banks in Africa
    • Chairman of the National Association of Broadcasters, an umbrella industry association for all Television, Radio and online broadcasters in Uganda.
    • Chairman of Board of Directors of Nile Hotel International, that owns the leading hotel in Uganda, Kampala Serena Hotel.
    • Chairman of Board of Directors of Soliton Telmec Uganda, the leading telecom company in Optic fibre business managing over 80% of optic fibre in Uganda.