The U.S. Census Bureau’s Service Annual Surveys include data on advertising expenditure from 1998 to 2007. I’ve extracted and compiled these advertising data and compared them to widely cited figures from the Coen advertising expenditure dataset.
The Service Annual Surveys use statistically representative surveys of firms. The survey reports classify and aggregate firms’ revenues by firms’ industrial classifications. The Information and Communications Industries Revenue Dataset provides data for all revenue categories reported in the surveys from 1998 to 2007. One revenue classification is advertising revenue, which of course is advertising expenditure seen from the other side of the transaction.
The Service Annual Surveys have some advantages for measuring advertising expenditure. These data are based on a consistent, well-documented methodology administered by an independent, highly professional organization (the U.S. Census Bureau). The Coen advertising expenditure dataset is an extraordinary information resource spanning the years 1917 to 2007. However, it is closely linked to interested industry sources. Moreover, the methodology underlying the Coen advertising expenditure dataset isn’t clear, probably has varied across time, and almost surely varies across advertising expenditure categories.
The Service Annual Surveys provide an insightful alternative categorization of advertising expenditure. Because the surveys are firm-based, they allow some separation of advertising media expenditure, e.g. payments to television stations for advertising air time, from advertising service expenditure, e.g. fees paid to advertising agencies for preparing and placing ads. The Coen advertising expenditure data, according to a Universal McCann source attribution, aggregate with advertising media expenditure “all commissions as well as the art, mechanical and production expenses that are part of the advertising budget for each medium.” Based on data reported in the Service Annual Surveys for 2004-2007, expenditure on advertising agencies, media buying agencies, and media representatives amounts to about 18% of expenditure on advertising media.
The Coen advertising expenditure total is about 30% larger than total advertising media and services revenue recorded in the Service Annual Surveys for 1998 to 2007. Survey Annual Survey totals for media categories, marked up by the services/media ratio, typically are within plus or minus 40% of the corresponding Coen categories. However, Coen direct mail advertising expenditure is more than three times the corresponding Service Annual Survey figure from 1998 to 2007. The Coen “miscellaneous” advertising category rises sharply relative to the Service Annual Survey “other advertising” revenue from 1998 to 2007, and from 2004 to 2007 the Coen miscellaneous /other advertising figures are more than twice the Service Annual Surveys other advertising figures.
The comparison between the Service Annual Survey advertising data and the Coen figures points to difficulties in precisely estimating advertising expenditure. Advertising time and space often are sold with a variety of price discounts. Advertising time and space also are commodities commonly included in barter deals. Discounts and barter make advertising expenditure difficult to estimate even thought a set of well-known firms dominate the supply of radio, television, and cable advertising opportunities.
The advertising data from the Service Annual Surveys, 1998-2007, along with the comparisons to the Coen advertising data, are available online in a browser friendly format as well as an Excel workbook.