According to the Swiss Advertising Statistics Foundation, net advertising expenditure grew by over ten percent in 1999By Daniel Schifferle The advertising industry can look back on an extremely successful 1999: net advertising investment increased by 10.2 percent or CHF 412 million. That is twice as much as in the previous year. Two types of media broke magical barriers: Out-of-home advertising broke through the CHF 500 million barrier for the first time, while private radio exceeded the CHF 100 million mark.
The Advertising Statistics Foundation was able to present an extremely pleasing result for 1999 this week. At last Tuesday's press conference, Wemf CEO René Schmutz and project manager Rolf Blum expressed their satisfaction with the accelerated growth in net advertising investment in Switzerland.
After the media had to report stagnating or even declining sales for the years 1995-1997, 1998 was the first year of growth again. However, while the growth rate at that time was only 5.2 percent, it even increased to 10.2 percent in 1999, almost doubling.
In nominal terms, this represents an increase of CHF 412 million. The total net advertising expenditure for 1999 thus reached a new record level of 4.466 billion francs.
All media types benefited from the upward trend
Practically all media categories benefited equally from the sustained growth. The only exception in the happy circle of winners: Teletext had no reason to celebrate this time with a slight drop of 1.5%.
The press, on the other hand, with its sub-categories of newspapers, consumer magazines and trade press, had the largest share. With an increase of 10.5% to CHF 2.835 billion, they reaped above-average benefits from the additional millions invested in advertising.
The most significant sales growth was achieved by newspapers sold, at 10.9%. A breakdown of this category by titles with different circulation sizes indicates a clear concentration of sales in the high-circulation daily newspapers: The 16 individual titles and total editions with circulations of over 50000 copies together generated CHF 1.854 billion. That is just under two thirds of total sales in the press category.
Commercial advertising again with a surplus
Particularly pleasing for the newspapers was the fact that last year, in addition to an excellent increase in the number of jobs by no less than
31.6 percent, sales from commercial advertisements also increased by 5.4 percent. As recently as 1998, the overall growth in the print media was solely due to the booming job advertisements.
Consumer magazines also performed comparatively well in 1999. They were even able to improve their net advertising sales by 7.1 percent, even without participating in the lucrative job market. Among the print media, this top result was only surpassed by the trade press. However, the reported gain of 14.8 percent cannot be taken as the full value because some additional smaller specialist titles were included in the 1999 survey.
TV advertising with strongest growth
1999 was also a particularly dynamic year for television advertising. New providers such as TV 3 and Tele 24, whose revenues could be reported for a whole year for the first time, revitalized the TV market and gave it the highest growth of all media types with a gain of 17.4 percent.
However, the private broadcasters should not be overly jubilant, as more than half of the additional CHF 65 million invested in TV, namely CHF 36 million, went to SRG. And there is something else that stands out in television: The sponsorship sector, which is reported separately for this medium, showed growth of no less than 37.7% according to the reported turnover.
However, even advertising statistics project manager Rolf Blum is not entirely comfortable with this phenomenal figure. He suspects that incorrectly reported sales paint an overly optimistic picture of the development of TV sponsorship.
Private radio, on the other hand, is enjoying a solid foundation. With revenue growth of exactly eight percent to CHF 105 million, this medium exceeded the CHF 100 million mark for the first time.
Out-of-home advertising breaks through the 500 million franc mark
Out-of-home advertising also managed to break through a magic barrier in 1999: thanks to a growth rate of 7.2 percent and total sales of CHF 502 million, it was able to just exceed half a billion francs in advertising revenue for the first time.
Sales in the non-poster sector developed particularly well, almost doubling year-on-year to CHF 27 million. This shows that Out-of-home advertising was very creative last year.
In contrast, cinema advertising, which grew by only five percent, had to be content with below-average growth. Nevertheless, this medium was able to continue its continuous growth of previous years to a similar extent in 1999.
There was also a clear upturn in advertising in directories in 1999. Following a 2.3 percent drop in sales in 1998, which was largely due to unreported sales of reference books in the process of being sold, 1999 saw a clear upward trend for the first time in several years with a nine percent increase in sales.
By contrast, the trade fairs and exhibitions segment made only minimal progress, achieving growth of just 0.9% to CHF 220 million. However, this figure needs to be put into perspective. As various trade fairs take place every two or three years, a comparison with the previous year makes little sense.
And in the promotional products segment, the reported sales growth of
6.7 percent to 121 million francs is merely a trend. Project manager Rolf Blum complains that sales reports from this area are particularly sparse and do not reflect the reality of the market. According to industry estimates, business with promotional items should be around four times higher than the figure currently reported.
Expansion planned for next year
Direct advertising has been missing from the advertising statistics since 1996, as the relevant data was no longer fully available from all providers. As of this year, transparency has been restored in the jungle of figures. Direct advertising will therefore be included again in the 2000 advertising statistics.
Internet advertising will also be reported from next year or the year after next at the latest. However, the Swiss Advertising Statistics Foundation will not collect the data itself: it will be provided by the management consultancy firm PriceWaterhouseCoopers.
Net advertising sales in Switzerland
(excluding production costs) in CHF million
1994 1995 1996 1997 1998 1999 Difference 98/99 in %
Press- Newspapers incl. free newspapers 1829 1962 1850 1850 1926 2118 10.0
- Consumer magazines 237 251 264 229 243 260 7.1
- Trade press 340 356 357 365 397 456 14.8
Total press 2407 2569 2471 2444 2566 2835 10.5
Cinema 30 34 37 39 40 42 5.0
Local radio 87 90 93 91 97 105 8.0
Commercial television 296 318 315 342 374 439 17.4
Sponsorship of programs 27 31 41 43 45 61 37.7
Teletext 12 13 13 13 14 13 -1.5
Outdoor advertising 391 446 448 447 468 502 7.2
Address books 121 121 121 121 118 128 9.0
Trade fairs and exhibitions 179 215 196 207 218 220 0.9
Promotional items 97 105 99 104 113 121 6.7
Total values collected 3647 3942 3834 3851 4052 4466 10.2