Television advertising spend in Spain is deteriorating at an alarming rate as overall spend was down 18% in the first quarter of the year. Investment bank Morgan Stanley has also warned that advertising revenues in April were much worse than experienced.
“FY12 advertising outlook has got much worse than we suspected only six weeks ago,” the bank noted. “The negative impact of substantial belt-tightening, tight credit conditions, high private household indebtedness, slowing exports and higher oil prices has led Spanish macro expectations to take another leg down in recent weeks. This deteriorated macro picture is weighing significantly on advertising spend, which is more than 80% correlated to private consumption in Spain.”
Mediaset España, for instance, which operates broadcasters Telecinco and Cuatro, was forecast by the bank to see advertising revenues down by 17.3% in the first three months of the year. While the European Championships football tournament will allow the broadcaster to remain flat in the second quarter, it is set to see national advertising revenue fall by 5.6% in the third quarter and 2.2% in the final quarter of the year.