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Schonfeld Predicts Continued Advertising Spending Increases in 2006

Schonfeld & Associates, Inc. has just released the 29th annual edition of its study, "Advertising Ratios & Budgets," which provides valuable information for monitoring competition and planning ad spending. In addition to 2004 advertising spending, the study lists forecasted 2005 advertising-to-sales ratios, ad spending in 2005 and 2006 and ad growth for each of more than 5,000 companies in more than 300 industries.



Large, diversified food companies are expected to spend $28.3 billion in 2006, up 8.1 percent in ad growth and spend a total of more than $3.6 billion in 2006.



The pharmaceutical industry will increase spending over 10 percent in 2006 and exceed $21 billion. The industries of biotech and electromedical apparatus show a growth in advertising spending of more than 10 percent. Advertising growth by telecommunication service companies will be 5.9 percent in 2006 with estimated spending of more than $22.2 billion worldwide. Ad spending for wireless communications services will continue increasing, up 9.1 percent to $12.8 billion. Cable and satellite TV services are also vying for a share of high-speed Internet access business and will spend $2.4 billion in 2006 for advertising, up 15.9 percent.



2006 will show continued demand for computer products although the pace of industry wide growth has slowed. PC manufacturers, led by Hewlett-Packard, will increase ad spending by 11.7% while advertising for software will rise only 2.1%. Advertising for semiconductors will be up more than 14 percent in 2006, and spending by computer communication equipment manufacturers will increase by more than 9 percent.



Retail department stores, such as J.C. Penney and Sears, will spend $4.4 billion in 2006, up slightly from 2005. Variety stores, such as Target and Wal-Mart, will increase their ad budgets 5.9 percent for a total of $4.1 billion. Advertising by direct mail catalog houses will continue to increase, reflecting Internet competition, to $1.3 billion. Online stores eBay and Amazon.com are growing their advertising budgets by 22 percent and 17 percent respectively.



In 2006, the top ad spender continues to be Nestle with an estimated budget of $15.8 billion, an increase of 9.9 percent. Over 700 major foreign-based firms are covered by this year's study, including such firms as Unilever and Sony. The automotive industry is expected to be the top spending industry with an outlay of $33.5 billion, a 7.6 percent increase. DaimlerChrysler, Fiat, Ford, General Motors, Honda, Nissan, Toyota, Volkswagen, and Volvo will each spend more than $1 billion.



"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 database format. Additional information is provided within the database to allow for analysis by corporate location or NAICS code.



Copies of the 200-page study are available for $395 or $495 with database. For more information contact Schonfeld & Associates, Inc., 2830 Blackthorn Road, Riverwoods, IL 60015, phone: 800-205-0030, email: e-mail protected from spam bots or visit the corporate website at http://www.saibooks.com for secure online ordering.

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