Cinema leads revenue charge

Cinema leads revenue charge

Cinema advertising saw nearly 10% added to its earnings total in 2002

Advertising revenue actually rose slightly in most sectors last year, new figures suggest.

Media spend as a whole increased over 2002 by 0.7% compared to the previous year, according to the latest estimates from Nielsen Media Research.

However, revenue for newspapers, magazines and regional press fell by 4.5% in 2002, an actual drop of  £1.5bn to £3.1bn, according to estimates from the media research body.

In contrast, television, radio, outdoor and cinema all recovered from 2001, led by cinema advertising which saw nearly 10% added to its earnings.

The figures this week coincided with Nielsen's agency league tables.

Carat comes out as the single agency with the most billings for the year, although MediaCom claims top spot in an alternative table based around agency groups.

The fall in press revenue reported by Nielsen took some by surprise. Jane Wolfson, head of non-broadcast at Initiative, said that said she was surprised by the drop and had expected a rise.

She added: "It's definitely not getting better. It might be up marginally in 2003, but not by much. Uncertainty about what's going to happen this year is making clients commit later."

Others were more optimistic. Neil Hurman, Mirror Group Newspapers ad director, said: "I don't think anyone enjoyed last year; they didn't enjoy the back end of the year before, but everything is relative. I don't think, certainly not in the daily market, that it was a bad year."

Lawrie Procter, commercial director at Independent Newspapers, said:"Last year was such an unpredictable year, not just for the national press but for all the media. I'd be surprised if television had a good year."

Television fared better than press, according to Nielsen, which estimates a revenue increase of 4.9% last year for the sector, to £3.63 billion.

But one commentator said of the increase in television revenue: "TV had an unbelievably bad 2001. So if they look like they had a good year in 2002, it could just have been redressing that."

Don Thomson, commercial director at Chrysalis Radio, welcomed the reported 2.3% growth in radio revenue from Nielsen and said that the medium's flexibility made it increasingly attractive to advertisers.

The outdoor industry managed a 4.7% rise in revenue, according to Nielsen, a much more significant rise than that reported by trade body representative the Outdoor Advertising Association last week, which put the figure at two per cent.

The discrepancy could be because Nielsen's estimates are based around rate card, and reduced yield in a competitive market would not necessarily be accounted for in the figures.

Alan James, chief executive of the Outdoor Advertising Association, said that the figure from Nielsen was "very nice", but added: "Nielsen isn't an exact calculator, but that discrepancy isn't that bad. We always expect there to be a small difference."

Cinema enjoyed the biggest proportional rise in revenue, growing 9.6% during 2002, and accounting for £1.54m of ad revenue, according to Nielsen.

Sandra Dickinson, director of marketing and research at Carlton Screen Advertising, said that quality films such as Harry Potter And The Philosopher's Stone, Lord Of The Rings and Spiderman over the last few years has helped push up cinema admissions.

"People are buying into an environment where they can just switch off and the way cinema is sold has changed over the last few years with more targeted packages now available," she added.

According to Dickinson, car advertisers have overtaken alcoholic beverage brands as the biggest growth sector in cinema revenue.

But although the revenue rises raised a few eyebrows, many industry observers view them as indicative of the last few tumultuous years that the media industry has endured.

Unprecedented events in 1999 and 2000, such as the Millennium and the dotcom land grab coupled with the Euro 2000 football tournament, pushed revenues sky high and after such a rapid rise the only way was down.

Andrew Canter, broadcast director at MPG, said: "Revenue was always going to be around par or up last year due to the dramatic decline in 2001 and 2000 was very atypical due to the amount of money brought into the market by dotcoms."

Thomson said: "The rise has to be borne in the context of 1999 and 2000 where things were rocketing up at a rapid rate."

Nielsen's single agency league reported a massive rise of more than 50% in billings for OMD UK, boosting the agency's position from ninth to fifth place. Starcom Motive, which maintained its number six position, enjoyed a healthy year, with an increase of 21.4% in its billings year on year during 2002.

But for MediaVest UK, things weren't so rosy - it fell from seven to 10.

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