New York, 25th Jan 2016 – Advertising spending delivered strong gains in December as U.S. consumers’ opinion of the economy improved to the highest level since July. The total market rose by 9% for the month, helping cement positive growth for the overall quarter, according to new Standard Media Index (SMI) data.
Following two vibrant months in the fourth quarter, television ad volumes dipped -3% year-on-year in December. The decline was primarily caused by challenging ratings seen across many networks, and potentially affected by advertisers’ decision to ‘front-load’ their spend at the beginning of the holiday season.
In the digital sector, the market jumped by 34% in December compared to the same time last year– a result that echoed growth rates seen consistently throughout 2015. SMI said the key drivers were content sites (21%) sites and programmatic spending (40%), which together made up the majority of digital ad dollars.
SMI’s data also recorded a steady increase in newspaper advertising during December, but the magazine, out of home and radio sectors all suffered and posted slight declines. All media sectors ended the fourth quarter with solid year-on-year growth, with the exception of magazines.
“Rising consumer confidence and a positive start to the new broadcast year delivered a strong fourth quarter, which lifted the total market into positive territory following a lackluster first nine months of the year,” said James Fennessy, SMI’s chief commercial officer.
“The overall market results were definitely underpinned by excellent NFL ratings and the new dollars from fantasy leagues. On the downside, we see that soft ratings, especially in cable, combined with challenges around digital’s effectiveness causing concerns and this impacted December’s results.”
SMI’s latest data showed that ad investment remained in line with U.S. consumer sentiment figures recently released by the University of Michigan, which showed that sentiment rose in December to its highest level since July 2015. It was lifted in part by low inflation, modest gains in income and cheaper gas, which has boosted Americans’ purchasing power.
The figures reinforce that as consumers spend more, advertisers are chasing them in the hope of capturing more of their hard earned dollars.
SMI captures 80% of total U.S. agency spend exclusively from the booking systems of five of the six global media holding groups, as well as leading independents. It reports monthly on actual spend data and is the clearest picture of the flow of dollars across the sector.