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SMI: National Ad Spend Trend Moves From Plus To Minus In Q3 2022.

Standard Media Index's just-released media investment and revenue report for September 2022 shows, for the first time this year, a downward year-over-year quarterly trend in total agency spending from national brands, off 6% compared to Q3 2021.

September itself shows a -5% change from a year earlier, so while not an improvement from August's -4% year-over-year change, still ahead of July's -11% downtrend. Even so, it marks the fourth consecutive down month for agency spending. “The Q4 holiday season will remain a crucial time to determine if the market can turn around from the recent decline trend,” SMI's report says.

SMI's figures are based on actual spend data from major agency holding companies and large independent agencies representing up to 95% of all U.S. national brand ad spending. As such they exclude local ad sales, which make up the majority of radio revenues.

While radio itself also displays a double-digit quarterly decline from 2021, agency spend remains up, if just barely, from Q3 2020. Media staying ahead of the pace include newspapers, out-of-home and digital, the latter claiming two-thirds of national ad dollars in Q3 2022, close to $13.2 billion. Television is the main driver of the quarterly decline, with a significant spending cut for sports on linear TV without a Summer Olympics in July or August of this year.

Even as seven of the 12 largest product category groups spent less in September 2022 compared to a year earlier, pharma, retail and travel all hit new spending highs for September, with the former increasing its spend by more than $104 million, most of that toward digital. Consumer packaged goods, tech and entertainment & media still dominated national brand spend, although tech spend dropped 21%. Automotive, meanwhile, displayed its first September uptrend in spending since 2017.

All of the top five media companies show spend declines vs. September 2021, with Disney and Meta (-2% for each) weathering the storm best. A year-over-year downtrend for September is new for both Google (-13%, highest of the five) and Meta, while that's been a regular occurrence for Disney, Comcast (-5%) and Paramount Global (-6%). Google's double-digit decrease comes as spend on search was down by more than $147 million, while cable TV's $248 million spend decline impacted several of these owners.

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