Spending on direct marketing is projected to fall $87.6 million between last August and Sept. 2006 as a result of Hurricane Katrina, according to PQ Media.
Overall, the hurricane will cause total media spending to fall by $1.13 billion from August 2005 to September 2006, making it the costliest natural disaster on record to hit the media industry, according to PQ.
The loss is estimated to account for 2.2% of media spending in the 20 affected designated market areas (DMAs) in the 12-month period. Of these areas, New Orleans accounts for 64.8% of the total loss, or $732.5 million, a 14.3% decline in the city’s projected annual media spending.
From a broader industry perspective, the total represents a decline of only 0.2% of the $887.37 billion in media spending expected in the next year, the report continued.
In addition, spending on marketing services: consumer promotions will fall by $91 million, custom publishing by $84 million, and event sponsorships by $53 million. Katrina’s impact on media spending will be greater then that of hurricane Andrew, which hit south Florida in 1992 and caused between $350 million and $450 million in losses, according to the report, PQ Media’s Impact of Hurricane Katrina and Other Storms on Media Spending.
“The only catastrophic event to have a greater impact on media spending than Katrina was the September 11, 2001 terrorist attacks, which were man-made and affected media spending nationwide,” said Patrick Quinn, president of PQ Media in a statement.
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