Tuesday, July 31, 2012

Slow economy leads to revised ad forecasts

With the rather bleak economic numbers released by the US government over the last weeks, and with the weak results posted by some big agency holding companies, many business analysts are revising their advertising revenues forecasts down.  The latest report puts US GDP growth at 1.5% for the second quarter.
On Thursday, IPG (Interpublic Group) reported organic growth of less than 1%, while earlier this month, Publicis Groupe reported 1.6% organic growth for the period.
Responding to the weak numbers, a Commerce Dept. spokesman blamed the slowdown in US ad spending on a decline in local and state government activity, and the global economic slowdown.  Since neither factor contributes much (if anything) to US ad revenues directly, the comments suggest more of a "pass-the-buck" political response, than a meaningful consideration of causality.

Source -  Slowed Economy Impacts Ad Growth, Agencies Revise ForecastsMediaDailyNews

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