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May 30, 2008

NEWS: What Top Brands Spend on Advertising

Procter & Gamble, et al, Changing The Way They Buy Ads, "Wreaking Havoc" With Big Media

This week Viacom (VIA) CEO Philippe Dauman warned Wall Street that ad sales aren't going well: The 7% growth the company had in the first quarter will be more like 3% to 4% in Q2. Philippe singled out weakness in automotive industry, in addition to the already decimated financial/mortgage business

But Martha Stewart Living Omnimedia president Wenda Harris Millard (SA 100 #38) says that's just the tip of the iceberg. She says that in addition to a faltering economy, big media now faces a new problem: It can't see the future any more.

Why? Because a staple of the ad industry -- consumer packaged goods -- has changed the way it buys advertising, and the results have thrown the media business into chaos.

Earlier this year, CPG companies like Procter & Gamble (PG), under pressure from their own rising food, commodities and fuel costs, shifted ad planning from an annual to a quarterly basis and making shorter-term ad commitments. That means media companies that could once make reasonable projections for FY revenues now have to update their assumptions every few months. "The planning cycle has changed," Wenda tells us. "This is wreaking havoc on media company forecasting."...

What Top Brands Spend on Advertising

Tuesday, October 16th, 2007; -- Janet Meiners |

Want to know what top companies like Microsoft, Google, and even Coca-Cola spend on advertising? Here’s a breakdown by percent of revenues in 2006, starting with the most first (according to this article):

  1. Microsoft - more than 20 percent of their annual revenue or $11.5 billion
  2. Coca-Cola – more than $2.5 billion
  3. Yahoo - more than 20 percent of their annual revenue or $1.3 billion
  4. eBay - 14 percent to 15 percent of its revenue - which was $871 million, much of that to advertise on Google
  5. Google – In the millions rather than billions of dollars – with $188 million
  6. Starbucks - $95 million...

Zuckerberg: “Larger part of advertising is in traditional brand ...
By Nick Gonzalez 
Look at this Marketing Pilgrim post for an idea of how big the brand advertising business can be. Brand spending across our network (movies, music) seems like a test budget compared to the money that sits behind the dam. ...

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