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How much is spent on advertising?
Canada is the ninth largest advertising market in the world. Newspapers are the most popular advertising medium, followed by television, magazines, radio, and outdoor advertising. In the U.S., televisions ranked first and newspaper second. Below are some recent stats on the Canadian and U.S. advertising market. Although the advertising dollars are smaller in Canada, the trends run parallel to U.S. spending.
- Television:
23.4 percent, or $50.4 billion, of the advertising dollars spent in the United States is in television. Television is available to advertisers in two forms: broadcast and cable. Broadcast TV - television signals that are sent over the air rather than through cable wires -
generates all of its revenue from advertising. Advertising accounts for about 60 percent of cable television revenues with the rest coming from subscriber fees.
- Newspaper: Newspapers are the second most popular advertising medium after television and received 21.7 percent, or $46.6 billion, of all advertising dollars. Newspapers enable advertisers to reach readers of all age groups, ethnic backgrounds, and income levels. Two types of advertising appear in newspapers: classified advertising, such as the want ads, and display advertising. Display ads range in size from as large as a full page to as small as one column in width and less than one centimeter (less than one inch) in length. Display ads often contain illustrations or photographs and usually provide information about where the product or service being advertised can be purchased. Typically, advertising makes up about 65 percent of a newspaper's content and generates about 65 percent of a newspaper's revenue. About 88 percent of this revenue comes from local businesses.
- Direct mail: The third largest advertising medium, attracting about 19.2 percent, or $41 billion, of all U.S. advertising dollars. Direct mail advertising, as the name implies, is advertising that is sent directly to people by mail, usually through the postal system. Direct mail can be as simple as a single letter or as involved as a
catalogue. The big benefit of direct mail is that you are able to extract data known about your audience.
- Radio: Attracted about 8 percent, or $17.2 billion, of all U.S. advertising dollars, making it the fourth largest advertising medium. Although national advertisers can buy national network radio time, 90 percent of all radio advertising is local. Unlike television which reaches a broad audience, the specialized programming of radio stations enables advertisers to reach a narrow, highly specific audience such as people who like sports or urban teenagers who listen to the latest styles of popular music. Because many people listen to radio while in their cars, radio also enables advertisers to reach prospects during key times of the day. But because people listen to the radio while doing something else such as driving or working, radio commercials can be easily
misunderstood and the message not
retained as well. As a result, radio ads work best when the messages are relatively simple ones for familiar, easily understood products.
- Yellow Pages: The thick directories of telephone listings and display advertisements, represented the fifth most popular advertising medium, attracting $12.6 billion, or 5.9 percent, of total advertising spending. Almost all advertising in the Yellow Pages is local advertising.
- Magazines: Ranked sixth in total U.S. ad spending, representing 5.3 percent, or $11.4 billion. Although newspapers reach all different kinds of readers, a magazine’s specialized editorial content generally reaches readers who have similar interests. The relatively specialized, narrow audience of a magazine enables an advertiser to speak to those most likely to buy a particular product.
- Internet: Accounted for $1.9 billion in advertising revenue in the United States, or 0.9 percent of total ad spending. Advertisements on the Internet often take the form of banners, buttons, pop-ups, and sponsorships. But the most important aspect of Internet marketing is that the World Wide Web allows advertisers to personalize their messages for individual customers.
- Outdoor:
Advertising amounted to 0.8 percent, or $1.7 billion, of total ad spending in the United States. Outdoor advertising is an effective way to reach a highly mobile audience that spends a lot of time on the road
- for example, in commuting to and from work or as part of their job. It offers the lowest cost per exposure of any major advertising medium, and it produces a major impact, because it is big, colorful, and hard to ignore. The messages on outdoor boards have to be very brief. So outdoor advertising primarily serves as a “reminder” medium and one that can trigger an impulse buy.
(Source: "Advertising," Microsoft® Encarta® Online Encyclopedia 2003)
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