Advertising: by the numbers

Advertising: by the numbers

John Wanamaker, a department store mogul of the early 20th century, once said: “Half the money I spend on advertising is wasted; the trouble is, I don’t know which half.” Many of today’s advertisers probably feet the same way, but spending on ads has continued to grow nonetheless.

In 2005, companies spent more than $143 billion on advertising in the U.S. That’s more than the Gross National Product–the value of art goods and services produced in a country in a year–in Israel, Malaysia, or Venezuela.

More than $47 billion of that total was for newspaper and network TV advertising. But the Internet is growing rapidly as an advertising medium. In 2005, about $12.5 billion was spent on Internet ads. Initial estimates from 2006 show a jump to $16.8 billion, an increase of about 34 percent.

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ANALYZE THE GRAPH

1. How much more (in

millions) did McDonald’s

spend on advertising in

2005 than Unilever, which

sells products as diverse

as bath soap and frozen

foods?

(a) $20M (c) $400M

(b) $200M (d) $300M

2. In 2005, AT&T actually

spent 26 percent less on

advertising than it did in

2004. Approximately how

many billions of dollars did

AT&T spend on advertising

its telecommunications

services 2004?

(a) $3.2B (c) $3.5B

(b) $3B (d) $3.6B

3. In 2005, the U.S. government

spent $1.3 billion on

ads. This was about $200

million less than

(a) Sony (c) Altria

(b) Toyota (d) Sears

4. In 2005, two companies

spent about half as

much on ads as did

Proctor & Gamble, the

giant Cincinnati-based

maker of 300 brands

of soaps, cleaners, and

other products. These

companies are —

and –.

5. General Motors spent

twice as much on ads in

2005 than its auto-making

rival –.

6. Coca Cola, the Atlanta-based

soft-drink maker

whose ads seem to be

everywhere, actually spent

a lot less than other major

advertisers in 2005–only

about 20 percent of what

media giant Time Warner

spent, to cite one example.

About how much did Coke

spend on ads in 2005?

(a) $250M (c) $500M

(b) $400M (d) $700M

ANSWER KEY

1. [b] $200 million

2. [a] $3.2 billion

3. [c] Altria

4. [d] Watt Disney and Johnson & Johnson

5. Daimler Chrysler

6. [d] $700 million

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