Diversified Food to Lead 2011 Ad Budget Rebound

Earlier this month, Schonfeld & Associates released its 2011 Advertising Ratios & Budgets forecast. Like other industry watchers, Schonfeld analysts expect to see an uptick in ad spending next year.  Schonfeld predicts that companies will increase their advertising spending by 0.6% between 2010 and 2011. That increase would bump up the average ad-​to-​sales ratio for all industries in the Schonfeld study to 2.1%.

The improved outlook comes as 2010 advertising in certain sectors is struggling. For example, Schonfeld analysts say that the financial services sector has cut ad spending by 17.4%. Other industries that have reduced advertising this year include travel and transportation (-4.0%) and electronic and scientific instruments (-3.3%).

For next year, some sectors will prove to be big spenders:

  • Diversified food — $30 billion
  • Pharmaceutical companies — $26 billion
  • Wireless communications services — $24.6 billion

In addition, the Schonfeld data shows that ad spending in the automotive, retail stores and semiconductor and related device industries will drop next year.  Despite the anticipated drops in some industries, such as automotive, Schonfeld analysts point out that big spenders will still play a key role in the advertising market. For example, U.S. giants General Motors and Ford should each spend $1 billion in advertising next year, as will Honda and Toyota.

[Sources: Ad Recovery for Most Industries by 2011. MarketingProfs. 23 Jun. 2010 Web. 20 Jul. 2010; Maddox, Kate. Schonfeld forecasts advertising recovery. BtoB Online. 12 Jul. 2010. Web. 20 Jul. 2010] 
Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.