Internet Marketing

U.S. Advertising Market Exhibits Strong Growth in 2003

Internet advertising, at 15.7%, registered the strongest growth rate in 2003, according to a new report by TNS Media Intelligence/CMR

NEW YORK, March 8, 2004 - Total advertising expenditures for all media in 2003 increased 6.1% to $128.3 billion compared to 2002, according to data released today by TNS Media Intelligence/CMR, the leading provider of strategic advertising and marketing information.

"The robust growth in 2003 ad spending is a result of the overall health and growth of the economy; the rising level of consumer confidence and the willingness to spend; and the improvement in overall corporate performance," says Steven J. Fredericks, president and chief executive officer, TNS Media Intelligence/CMR. "While 2003 began with the ad marketplace being uncertain about the direction of the economy and the war's impact on spending, the reality was overall advertising was not adversely affected."

Almost all of the media measured by TNSMI/CMR experienced growth throughout the year, with the Internet, Cable TV, National Syndication, Local Newspapers, and Spanish Language TV showing double-digit year over year gains.

Local Newspapers led in dollar spending for 2003, posting $22.7 billion, an increase of 13.4% versus 2002. Spending in the telecommunications, automotive, real estate, retail banking and motion pictures advertising categories fueled this growth.

The Internet showed the most robust year-over-year gain for 2003 posting a 15.7% increase to $6.4 billion in ad spending versus 2002. This reflects continued growth of advertiser confidence in the Internet as a mainstream medium due to key factors such as expanding broadband penetration, more appealing ad formats and improved efficacy of online advertising.

Compared to Network TV - Cable TV, Syndication and Spanish Language Network TV all exhibited robust double-digit growth from 2002. Cable TV increased 15.6% to $12.2 billion in spending, an indication of advertiser interest in the ability to reach audiences with specific interests. Spanish Language Network TV showed a 12.8% increase to $2.1 billion in spending, as advertisers continue to target the Hispanic marketplace. Syndication increased 15.3% to $3.3 billion, due in part to additional off-network programming and advertising inventory.

Ad Spending by Media: Full Year 2002 vs. 2003¹

MEDIA DEC YTD 2002 (Millions) DEC YTD 2003 (Millions) % CHANGE NEWSPAPERS (LOCAL) $20,092.3 $22,787.1 13.4% NETWORK TV $20,015.7 $20,374.5 1.8% CONSUMER MAGAZINES  $17,254.1 $18,346.8 6.3% SPOT TV $17,165.3 $16,244.4 -5.4% CABLE TV2 $10,593.3 $12,250.9 15.6% B-TO-B MAGAZINES6 $7,226.7 $7,277.3 0.7% LOCAL RADIO3 $6,575.3 $6,732.3 2.4% INTERNET $5,612.9 $6,494.7 15.7% SYNDICATION - NATIONAL  $2,945.6 $3,395.8 15.3% NATIONAL NEWSPAPERS $2,813.6 $2,976.2 5.8% OUTDOOR $2,475.3 $2,672.5 8.0% NATIONAL SPOT RADIO4 $2,452.3 $2,635.2 7.5% SPANISH LANGUAGE NETWORK TV5 $1,946.1 $2,195.9 12.8% SUNDAY MAGAZINES $1,264.4 $1,330.9 5.3% FSI's7 $1,239.4 $1,317.4 6.3% NETWORK RADIO   $965.6 $1,000.6 3.6% LOCAL MAGAZINES $311.0 $325.4 4.6% GRAND TOTAL $120,948.9 $128,357.7 6.1%

Source: TNS Media Intelligence/CMR
¹ Figures are based on the TNS Media Intelligence/CMR Stradegy2 multimedia ad expenditure database across all TNSMI/CMR measured media, including: Network TV, Spot TV, Cable TV, Syndication, Spanish Language Network TV, Consumer Magazines, Sunday Magazines, Local Magazines (33 publications), Newspapers (local and national), Network Radio, Spot Radio, Local Radio, Internet and Outdoor. Figures do not contain public service announcement (PSA) data.
² Cable TV figures based on 37 networks
³ Local Radio includes expenditures for 31 markets in the U.S provided by Miller Kaplan.
⁴ National Spot Radio data are estimated.
⁵ Spanish Language Network TV includes expenditures from Univision, Telemundo and Telefutura.
⁶ B2B figures based on Business Information Network (BIN) data as reported by TNSMI/CMR to the American Business Media (ABM).
⁷ FSI data represents distribution costs only.

Ad Spending by Advertiser⁸Procter and Gamble was the leading advertiser in spending and year over year change for 2003, posting a 24.7% increase to $2.6 billion. Other leading spenders include General Motors, whose advertising activity totaled $2.4 billion and Time Warner with a total of $1.8 billion. Walt Disney Co and DaimlerChrysler showed robust year-over-year growth: 17.8% and 13.2% respectively.

COMPANY DEC YTD 2002 (Millions) DEC YTD 2003 (Millions) % CHANGE PROCTER & GAMBLE CO $2,143.7 $2,672.1 24.7% GENERAL MOTORS CORP $2,494.1 $2,486.2 -0.3% TIME WARNER INC $1,833.1 $1,879.3 2.5% DAIMLERCHRYSLER AG $1,390.0 $1,573.7 13.2% FORD MOTOR CO $1,430.1 $1,414.4 -1.1% WALT DISNEY CO $1,162.5 $1,369.3 17.8% JOHNSON & JOHNSON $1,044.6 $1,171.4 12.1% VERIZON COMMUNICATIONS $1,020.9 $1,121.8 9.9% SONY CORP $905.7 $1,017.1 12.3% TOYOTA MOTOR CORP $936.1 $1,009.5 7.8% TOTAL $14,360.7 $15,714.9 9.4%

Source: TNS Media Intelligence/CMR
⁸ Total ad spending figures by company do not include expenditures for Local Radio, National Spot Radio, and FSIs

About TNS Media Intelligence/CMR
TNS Media Intelligence/CMR is the leading provider of strategic advertising and marketing information - across media, brand, industry and market. The company's tracking technologies collect occurrence and expenditure data on more than 1.9 million brands spanning 20 media. TNS Media Intelligence/CMR is headquartered in New York City and maintains sales locations in major markets throughout the United States.

Within the TNS organization, TNS Media Intelligence/CMR is a key member of the Media Intelligence sector - dedicated to providing worldwide tracking, analysis, evaluation and consultative services for the media and marketing communities. TNS Media Intelligence is the market leader in the U.S. and France, with significant operations in Europe and Asia. For further information, including this and prior press releases, please visit http://www.tnsmi-cmr.com.

About TNS
TNS is one of the world's leading market information groups, providing market measurement, analysis, insight and advice in more than 110 countries. Working with national and multi-national organizations, TNS helps its clients develop effective business strategies and enhance relationships with their customers. Further information on TNS can be found on http://www.tns-global.com.

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