Lack Of Auto Ads Not As Bad As Some Thought
June 23, 2009 at 5:08 AM (PT)
LINDA GRAY, a GM in MONTANA, said of falling auto ad sales, "It isn’t down as much as we expected it to be." THE NEW YORK TIMES writes, "Auto advertising, her biggest category, had already dropped 32% through MAY of this year compared with last year. Now, dealers in MISSOULA, HAMILTON, KALISPELL, LIVINGSTON, BILLINGS and THREE FORKS -- all areas where she had stations -- were losing their CHRYSLER or GM lines.
"So Ms. GRAY has been surprised to find the closings have not hurt her advertising too much. 'Auto is definitely down, but it isn’t down as much as we expected it to be,' said GRAY, the Pres./GM of MAX MEDIA/MONTANA. "We weren’t so much affected by the closures."
"The situation is not as bad as it could be because the strong dealers, usually the biggest advertisers, largely kept their franchises.
"And many of the dealers who lost their CHRYSLER and GM lines were not shutting their doors -- they were selling used cars, or continuing to sell other brands. Local media are finding a chrome lining to the dealership closures.
"Local traditional media -- television, radio and newspapers -- are more reliant on automotive advertising than any other medium. In 2008, TV stations got 23% of their total advertising from auto, followed by local newspapers at 17% and radio stations at 14%, according to a SANFORD C. BERNSTEIN & COMPANY report released this month.
"The BERNSTEIN estimates project auto advertising to fall by about 22% this year altogether. But by next year, the firm says, pent-up demand should drive cars sales higher, resulting in a 12% increase in auto advertising -- with local stations expected to be a big beneficiary of that increase."