Consumer Ad Market Up 15.9% In 3rd Quarter

Folio: The Magazine for Magazine Management, Nov, 2000 by Jennifer F. Steil

But volatile markets may cause a slowdown in 2001.

The advertising upsurge continues, exceeding even last year's stellar increases, with the most dramatic gains occurring in Technology, Retail and Media & Advertising categories, according to the latest figures from the Publishers Information Bureau.

The end of third-quarter year-to-date figures show a 15.9 percent increase, to $12.4 billion, in advertising revenue over 1999. Ad pages year-to-date were up 12.9 percent, to 203,997.

Total magazine advertising for September closed at $1.7 billion, a 12.4 percent increase over the same period last year. Ad pages for September were 28,550, up 7.1 percent over last year.

"It's certainly larger than anticipated," says Magazine Publishers of America president Nina Link. "At the end of 1999, Chris Miller [the former executive vice president/chief marketing officer of MPA] was being optimistic forecasting a 7 to 8 percent increase, so this is fairly dramatic."

According to Alan Jurmain, executive director, media services, for Lowe, Lintas & Partners, "The overall marketplace had more money than it knew what to do with. Television reaped almost unprecedented gains--and in a year of fragmentation, you can't get the job done solely in television. I'd be more surprised if TV went one direction and magazines went in another," adds Jurmain. "Now they're poised to succeed and fail almost at the hip."

Despite the bottom falling out of the technology-laden Nasdaq market in April, dot-com advertising continues to spur growth, says Link Year-to-date, dot-com advertising is up about 400 percent.

Christopher Little, president of Meredith Publishing Group, also stresses that more and more people have disposable income to drop on luxury goods. "Not just millionaires, but a significant segment of mainstream America can afford to splurge," says Little.

There's no reason the growth should not continue in the fourth quarter, says Link, although she doesn't assume double-digit increases will persist next year. "Even though people are still optimistic, and we have inflation in check, it's a little volatile out there right now," she says.

Jurmain echoes her concerns. "The softening of the marketplace and unpredictability of the election may have marketers having a tighter grip on the trigger," he says.