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Ad Spending Slumps in 2008, Projected to Decline Significantly in 2009
Advertising expenditures worldwide fell 2 percent in 2008 to $643 billion, about 1 percent of the gross world product (all figures in 2008 dollars).1 (See Figure 1.) Of this total, 42 percent was spent in the United States, the lowest percentage since measurements started in 1950.2 Yet a much greater amount is still spent per person on advertising in the United States than in the rest of the world. In 2008, some $891 was spent per American—nine times as much as the $96 spent per person worldwide.3 (See Figure 2.)
Advertising expenditures on major media—on television, newspapers, magazines, the Internet, radio, outdoor ads such as billboards, and movies (listed order from largest to smallest spending)—reached $494 billion in 2008.4 This figure was 1 percent below the number in 2007 and is projected to decline another 11 percent in 2009.5 This significant contraction has been driven primarily by the stagnant global consumer economy and the resulting declines in consumer spending, which in turn has tightened marketing budgets.6
Declines in ad spending have been felt more in some media than others. Spending in newspapers worldwide fell 7 percent from 2007 to 2008—a decline of $7 billion—and is projected to fall another 18 percent in 2009.7 Magazines witnessed a similar drop, with ad revenue falling 6 percent in 2008 and projected to fall another 21 percent in 2009.8 This decline in advertising and the loss of readers to digital media have led many magazines and newspapers to shut down or file for bankruptcy protection, including the major U.S. media corporation Tribune Company, which filed for bankruptcy in December 2008.9
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