Ad Spending On Digital Content To See Hefty Increases In 2017

LIBERTYVILLE, Ill. - June 13, 2016 - PRLog -- Schonfeld & Associates, Inc. has just released the 40th edition of its annual study, Advertising Ratios & Budgets. The new research report covers more than 4,700 individual companies within 320 industries.

The study reports 2015 advertising budgets as well as forecasts for 2016 and 2017, advertising-to-sales ratios for 2016 and annual growth rates for ad spending and sales by company as well as industry so users of the study can monitor competition and plan their own ad spending. Overall, 2017 promises to be a year in which industries devoted to digital content will see hefty increases in advertising while industries in more traditional arenas will see advertising expenditures remain flat or see only modest increases. Although traditional advertising media may be seeing a decline, the ever-growing variety of new advertising channels has resulted in increasing total marketing activity. Money spent in nurturing a social media presence provides near to real time two way communication with customers, helping to build and maintain brand loyalty.

The automotive industry is expected to be the top spending industry with an outlay of over $42 billion, a 1% increase. Chrysler, Daimler, Fiat, Ford, General Motors, Honda, Nissan, Tata, Toyota and Volkswagen will each spend over $2 billion.

The pharmaceutical industry will increase spending slightly in 2017, exceeding $22 billion. The emphasis on affordable healthcare and industry consolidation has somewhat dampened the pace of increasing pharmaceutical advertising. The biotech industry will grow its advertising spending by over 12% to $2.6 billion. As in other industries, there is much interest and activity in social media advertising by the pharmaceutical companies. Most companies maintain Facebook pages and Twitter feeds.

Ad spending for cellular communications services will decrease slightly to just over $21 billion. Meanwhile, advertising growth by non-cellular telecommunication service companies will be down by 10% in 2017 with estimated spending of $9.3 billion worldwide. Widespread use of smart phones in everyday activity translates into continuing demand for high speed access, up-to-date equipment and digital content.

Diversified multi-media companies, such as Disney and NBC Universal, are expected to grow their ad budgets 3.2% to $12.6 billion while cable and pay TV services are increasing their ad spending 18.5% to $7.5 billion.

Large, diversified food companies are expected to spend a total of $8.6 billion in 2017, down from 2016's $9.2 billion. The soft drink industry will spend $5.5 billion, a slight increase on sales decreasing 4.7 percent. The 71 separate restaurant chains in the Schonfeld study will see flat ad spending and spend a total of $3.7 billion in 2017 as customers continue eating out regularly, with sales up 2%.

Apple, the well-known provider of consumer electronics, will increase its ad spending by over 12%. Advertising growth for the software industry will rise 7.5%. Advertising for semiconductors and related devices will be up 4.9 percent in 2017, while spending by computer storage device manufacturers will increase over 8%.

Variety stores, such as Target, Wal-Mart and Dollar General, will increase their ad budgets 1.6% for a total of over $5 billion. Retail department stores, such as Macy's and Kohl's, will spend just over $ 3 billion in 2017, down 7.8% from 2016.

Advertising by catalog and mail-order houses continues to increaserobustly to over $9 billion. Online powerhouse Amazon continues to grow its advertising budget by over 15 percent. A presence within the social media universe, along with spending on more traditional advertising, has become an integral part of every retailer's marketing and advertising efforts. Alphabet, parent of Google, is planning to spend over $3.7 billion, an increase of over 9%, while Chinese search engine Baidu will spend $2.2 billion, up 22 percent. Facebook plans to spend over $400 million in 2017 and LinkedIn will spend $29 million, both reflecting over 20% increases.

In 2017, the top ad spender will be Procter & Gamble with a budget of over $7 billion, a decrease of 4.8% over 2016, displacing Loreal with a budget of $6.9 billion, a decrease of 6.9%. Unilever is projected to show the largest increase of the top 10 spenders, increasing 4.7% to $6.4 billion. Over 600 major foreign-based firms are covered by this year's study, including such firms as Unilever and Sony.

Advertising Ratios & Budgets is widely used for strategic planning by ad agencies, monitoring competitors, planning ad budgets, and identifying new business prospects. It is also used for selling advertising space and time, and for planning by publishers and broadcasters in developing new media vehicles. Budgets are grouped to show all competitors within an industry. Data from the study are also available in Excel format. Additional information is provided within the datafiles to allow for analysis by corporate location or NAICS code.

Advertising Ratios & Budgets is compiled from a variety of sources such as 10-K Reports. Since reporting may vary from company to company, careful use of the findings are advised. Caution is urged when: (1) financial events such as mergers, acquisitions, and divestitures may distort spending patterns; (2) private ownership of very large companies in specific industries may mean that some advertisers are omitted; (3) multi-industry companies are reported only in their primary industry based on sales of their dominant line of business.

Copies of the 186-page study are available in either hard copy or PDF format for $ 395. Forecasts and data from Advertising Ratios & Budgets are also available for all companies and industries in Excel format. Additional information is provided within the datafiles to allow for analysis by corporate location or NAICS code. The 2016 edition of the 186 page study along with Excel datafiles is $ 495. Contact Schonfeld & Associates, Inc., 1931 Lynn Circle, Libertyville, Illinois 60048. Call for more information: 800-205-0030 or visit the company's web site at under the Area of Expertise: Advertising Spending.

Carol J Greenhut
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Tags:Advertising Budget, Ad To Sales Ratios, Marketing Spend
Location:Libertyville - Illinois - United States
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