Comcast spends more on marketing during Q2

The financial media has turned its attention toward the largest cable operator in the US, Comcast, as the company upped their marketing spending by 12.8% during the second quarter of this fiscal year.

By contrast, much of the competition, including Verizon and AT&T, have lowered their advertising budgets considerably.

Whether or not Comcast's marketing strategy will pay off remains to be seen during the 3rd quarter of 2012.

According to Kantar media, Comcast poured no less than $469.7 million into their advertising campaign for Xfinity products, making it one of the most expensive campaigns in the telecommunications industry. Although their investments in the marketing campaign have grown, Comcast's advertising budget decreased by $13 million compared to the first quarter of 2012.

AT&T, however, tried a different strategy for the second quarter. The company lowered their marketing budget by $375.5 million, while Verizon cut down their advertising spending by $326.9 million, or 14.7%.

In spite of Comcast's approach, Kantar reports show that the total marketing spending for the telecom industry in the second quarter actually dropped by over 2% to a little under $2 billion. In a recent statement, Kantar provided a brief overview of the telecom industry during the second quarter. "Category performance remains divided, with advertising budgets from wireless service providers wilting under the weight of slowing subscriber growth and rising capital investments for upgrading networks while TV service providers continue to raise their media budgets."

According to the market research company, cable TV networks increased their advertising budgets by 0.9% over the second quarter and compared to 2011, while simultaneously decreasing their spending on broadcast TV networks by 0.4%.

Discussing how the advertising market has adapted to economic changes impacting all areas of business, Jon Swallen, Chief Research Officer at the North American branch of Kantar, mentioned that "the advertising market is mirroring the tepid, slow growth performance of the general economy. Third quarter results will get a short-term boost from the Summer Olympics and political advertising but sustained long-term improvement will probably be linked to the health of consumer spending on the goods and services that marketers provide."