Cloud hangs over latest adspend figures as recession fears grow

- A cloud hangs over Britain's latest record adspend figures with analysts fearing that returning recession will prevent a repeat performance next year.

- A cloud hangs over Britain's latest record adspend figures with analysts fearing that returning recession will prevent a repeat performance next year.

Despite total ad expenditure rising to £13.14 billion in 1997 -- a six per cent leap in real terms -- the effect of a strong pound on the UK's manufacturing industry will make such high increases difficult to sustain, experts warn.

The figures, published by the Advertising Association, confirm a sixth consecutive year of increase in adspend at constant prices since the two years of decline during the harsh economic climate in 1990 and 1991.

At the same time, they show that advertising's share of the gross domestic product has risen to 1.94 per cent, the highest figure for eight years and only marginally below the all-time high of 1.96 per cent recorded in 1989.

But the healthy picture is being threatened by the problems bedevilling manufacturing industry, which accounts for about 35 per cent of UK adspend. "Manufacturing is on the edge of recession," Mike Waterson, the AA's research advisor, said. "It's had a wobbly year which may well be reflected in next year's figures."

The AA's statistics confirm the press as the most powerful magnet for adspend, accounting for 53 per cent of total expenditure. TV is the second largest medium with a 28 per cent share.

TV's market share has remained virtually unchanged in the decade between mid-boom and cautious recovery although direct mail and press classified have recorded slight increases. Press display, however, has dropped back.

Smaller media -- posters and transport, radio and cinema -- drew in £981 million worth of advertising in 1997, representing just seven per cent of total adspend.

Nevertheless, the sector is producing significant success stories, particularly for radio which has seen its ad revenue jump by 120 per cent in the past five years.





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