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NAA Expects 4.1% Increase In Ad Spending In 2005

Press release from the issuing company

December 10, 2004 -- Vienna, Va. – Marketers will increase their spending on newspaper advertising by about 4.1 percent in the coming year to $48.6 billion, according to the Newspaper Association of America’s 2005 forecast for the newspaper business. James Conaghan, NAA vice president of research and business analysis, presented the forecast today at the 32nd Annual Media Week Conference in New York. Total ad spending in 2004 is projected to be $46.7 billion, up 3.9 percent from 2003. (Newspaper advertising expenditures for the first nine months of 2004 totaled $33.0 billion, according to preliminary estimates released last month by NAA.) The three primary advertising categories are all expected to show growth for the second straight year, according to the NAA. Forecasts in ad categories: National ad performance in 2005 will show modest increases (about 5.0 percent) as the overall economy expands. Conaghan forecasts national ad spending in 2005 to be $8.5 billion, up 5 percent from a 2004 projection of $8.1 billion. The 2005 forecast for retail advertising sales is $22.7 billion, up 3.0 percent from the 2004 projection of $22.0 billion. Consumers experiencing an improving labor market may help bolster retail ad sales, Conaghan said. Classified ad spending could reach $17.4 billion in 2005, up 5.2 percent from the 2004 projection of $16.6 billion. While advances in classified ad spending in 2004 were supported by the cyclical rebound in employment advertising and real estate ads, the classified outlook in 2005 may feature a different mix as a rising interest rate environment is factored into the ad spending strategies of real estate and auto marketers. The NAA expects continued performance improvement for employment as the labor market strengthens, Conaghan said. Conaghan’s complete forecast will be published in the January 2005 issue of Presstime magazine, NAA’s flagship publication.

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