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AD-TO-SALES RATIOS

When you're developing your advertising plan, one of the first steps is determining the appropriate advertising budget for your business. A useful starting point is looking at advertising-to-sales ratios to find the national average advertising expenditure for your business category.

Over the past 30+ years, many companies have been united in their use of one such tool - Illinois-based Schonfeld & Associates' annual study, Advertising Ratios & Budgets. The June 2011 edition, with key industry data published here for your use, covers hundreds of industry sectors. In addition to advertising-to-sales ratios, the study forecasts ad spending in 2012 and sales growth for each industry.

The first column lists the type of business. The second column is the Standard Industrial Classification (SIC). The third column is the average percent businesses in that industry spend on all advertising based on their total gross sales. The fourth column compares the estimated amount spent on advertising in 2010 to the forecasted amount for 2012 and the last column shows forecast sales growth for the industry.

Industry Name SIC Code Ad/Sales % 2011 Ad Growth % Sales Growth %
Operative Builders 1531 0.6 -47.9 -29.6
Construction - Special Trade 1700 0.3 19.3 -18.1
Electrical Work 1731 0.3 5.6 -10.4
Food And Kindred Products 2000 11.3 3.7 4.2
Meat Packing Plants 2011 1.5 2.3 2.4
Bakery Products 2050 0.1 -19.2 3.7
Beverages 2080 5.1 6.8 8.7
Malt Beverages 2082 3.8 2.7 13
Wine,brandy & Brandy Spirits 2084 11.8 -9.6 -2.4
Distilled And Blended Liquor 2085 14 -7 -4.9
Misc Food Preps, Kindred Products 2090 3.5 11.5 10.5
Carpets And Rugs (Product) 2273 0.7 -17.7 -14.6
Apparel & Other Finished Products 2300 5.3 5.6 5.7
Clothing -- Mens, Boys Furnishing, Work Clothing 2320 3.5 -2.9 -0.8
Clothing -- Womens, Misses, Jrs Outerwear 2330 8.4 4.2 1.8
Clothing -- Womens, Misses, Child, Infant Undergarments 2340 5.1 4.6 3.6
Lumber And Wood Products, Excl. Furniture 2400 0.5 -16 3.8
Household Furniture 2510 6.2 -10 -11.7
Wood Hshld Furn, Excl. Upholstered 2511 2.9 0.7 -7.4
Office Furniture 2520 0.3 -33.8 -69
Public Bldg & Rel Furniture 2531 0.6 -22.6 -6.3
Misc Furniture And Fixtures 2590 0.2 -47.7 -1.3
Newspaper: Pubishing, Pubg & Print 2711 1.1 10.5 -8.5
Periodical: Publishing, Pubg & Print 2721 3.1 -12.9 -4
Books: Pubg, Pubg & Printing 2731 12.4 -8.8 5.2
Miscellaneous Publishing 2741 2.3 8.3 2.2
Medicinal Chemicals, Botanical Products 2833 3 2.6 6.6
Pharmaceutical Preparations 2834 4.3 7.6 8.3
In Vitro,in Vivo Diagnostics 2835 0.6 -10.4 8.7
Perfume, Cosmetics, Toiletries Preparations 2844 19.8 1.7 1.3
Paints, Varnishes, Lacquers 2851 2.8 -0.3 -6.1
Misc Plastics Products 3080 0.3 -9.8 -11.7
Leather And Leather Products 3100 2.1 4.4 8
Footwear, Except Rubber 3140 4.3 4.3 5.1
Metal Doors, Frames, Mold, Trim 3442 1.2 -4.2 0.7
Ordnance And Accessories 3480 1.9 3.2 3.9
Lawn, Garden Tractors, Equip. 3524 0 -100 -28.5
Construction Machinery & Equip. 3531 0.2 -6.5 -6.5
Computer & Office Equipment 3570 0.4 -5.5 4
Household Appliances 3630 1.9 7.4 1.7
Household Audio & Video Equip. 3651 7.1 -7.5 -8.9
Ship & Boat Bldg & Repairing 3730 0 -100 5.1
Motorcycles, Bicycles & Parts 3751 1.6 -11.8 -8.8
Misc Transportation Equip. 3790 2.8 4.6 3.8
Optical Instruments & Lenses 3827 0.1 -23.4 -16.6
Ophthalmic Goods 3851 3.1 -5.8 4.2
Photographic Equip. & Supply 3861 1.1 -12.8 -4.5
Watches, Clocks And Parts 3873 7.1 2.6 7.1
Jewelry,silverwr,plated Ware 3910 1.1 3.3 1
Musical Instruments 3931 1.4 -29.7 -12.2
Sporting & Athletic Gds, NEC 3949 7.1 -3.2 -6.8
Transit & Passenger Transportation 4100 0.1 14.4 11.2
Trucking, Courier Svc, Excl. Air 4210 0.2 -2.5 -4.5
Trucking, Except Local 4213 0.2 -4 -5.9
Water Transportation 4400 3.7 -0.3 -0.9
Air Transport, Scheduled 4512 0.8 1.8 1.7
Air Courier Services 4513 0.8 -5.4 -6.3
Airports & Terminal Services 4581 1.1 2.7 -2.8
Transportation Services 4700 20.5 0.5 2.1
Arrange Trans-freight, Cargo 4731 0.1 2.7 0.4
Radio Broadcasting Stations 4832 2.7 -3.1 -0.6
Television Broadcast Station 4833 8.9 -18.6 -18.5
Cable And Other Pay Tv Svcs 4841 2 4.1 4.4
Communications Services, NEC 4899 4.8 8 8.3
Electric Services 4911 0.5 3.3 4.1
Hazardous Waste Management 4955 0.4 -0.8 8.1
Building Matl, Hardware, Garden - Retail 5200 1.2 -3.8 4.3
Lumber & Other Bldg Matl - Retail 5211 1.4 -3.6 -0.1
Department Stores 5311 4.4 -2.1 0.2
Variety Stores 5331 1.1 3.1 2.5
Misc General Mdse Stores 5399 3.6 23.5 3.4
Food Stores 5400 5.5 5 6.6
Grocery Stores 5411 0.8 2.9 2.5
Convenience Stores 5412 0.3 2.9 2.6
Auto Dealers, Gas Stations 5500 0.7 -7.1 -2.9
Auto And Home Supply Stores 5531 1.3 5.2 8.3
Apparel And Accessory Stores 5600 3.7 3.5 4.9
Women's Clothing Stores 5621 3.4 0.1 2.4
Family Clothing Stores 5651 1.7 0.8 3.9
Shoe Stores 5661 3.2 3.2 2.5
Home Furniture & Equip. Store 5700 3.4 -4.5 5.2
Furniture Stores 5712 7 -13.6 -9.3
Consumer Electronics Stores 5731 2.1 5.1 4.6
Computer And Computer Software Stores 5734 1.2 16.7 3.4
Record, CD And Tape Stores 5735 1 -8 -19.3
Eating And Drinking Places 5810 10.1 20.8 -4.2
Eating Places 5812 2.2 1.5 1.1
Miscellaneous Retail 5900 1.7 -2 -4.3
Drug & Proprietary Stores 5912 0.7 -0.6 6.2
Misc Shopping Goods Stores 5940 3.4 -1.5 -0.9
Jewelry Stores 5944 5.3 -2.4 -1.3
Hobby, Toy, And Game Shops 5945 3.3 -0.9 -0.1
Catalog, Mail-order Houses 5961 3.1 9.2 13.5
Retail Stores, NEC 5990 2.5 -2.3 3.7
Commercial Banks 6020 0.4 39.9 3.2
Personal Credit Institutions 6141 0.3 -8.5 2.2
Misc Business Credit Instn 6159 0.2 -5.4 -25.1
Mortgage Bankers & Loan Corr 6162 2 -23.3 -15.7
Loan Brokers 6163 6.5 -16.2 10.8
Finance Lessors 6172 0 -100 -8.6
Security & Commodity Brokers 6200 1.1 -1.9 18.6
Security Brokers & Dealers 6211 1.7 9.2 0.9
Investment Advice 6282 2 5 0.1
Life Insurance 6311 1 -25.4 18
Accident & Health Insurance 6321 1.2 4.7 5.4
Hospital & Medical Svc Plans 6324 0.4 3 4.1
Fire, Marine, Casualty Ins 6331 0 -27.3 12.5
Insurance Agents, Brokers & Service 6411 0.7 10.6 15.1
Real Estate 6500 1.2 -21.4 -1.2
Operators - Nonresidential Bldgs 6512 0.3 1.6 3.2
Operators - Apartment Bldgs 6513 0.1 -1 4.8
Real Estate Agents & Mgrs 6531 4.5 -7.8 -0.9
Subdivide, Developers, Excl. Cemetery 6552 0.4 10.9 18.3
Real Estate Investment Trust 6798 4 -1.9 -0.6
Investors, NEC 6799 0.4 -1.3 4.9
Hotels, Other Lodging Places 7000 1 1.7 1.5
Hotels And Motels 7011 1.8 -2.2 -4.5
Personal Services 7200 7.2 -3.1 -5.1
Advertising 7310 1.7 10.2 0.7
Advertising Agencies 7311 0 -100 3.7
Credit Reporting Agencies 7320 1.7 5.1 2
Mailing, Reprographics, Comml Art Svcs 7330 20.4 17.7 16.9
Building Maintenance Services 7340 3.8 5.3 1.5
Misc Equip. Rental & Leasing 7350 2.9 -5.8 -13.3
Employment Agencies 7361 3.8 -25.4 -8.4
Help Supply Services 7363 0.3 -24.1 -9.5
Computer Programming, Data Process 7370 4.2 5.4 2.1
Computer Programming Service 7371 0 4.6 10.2
Prepackaged Software 7372 3.6 6 3.2
Computer Processing, Data Prep Svc 7374 0.6 7.2 5.2
Misc Business Services 7380 0.8 12.1 17.7
Detective, Guard, Armor Car Svcs 7381 0 6.2 -0.2
Photofinishing Laboratories 7384 5 11.1 14.1
Business Services, NEC 7389 1.6 4.8 6.7
Auto Repair, Services,parking 7500 4.8 0.6 4.3
Auto Rent & Lease, No Drivers 7510 1.4 -15.2 -7.5
Motion Pic, Videotape Prodtn 7812 13.6 1.4 4.5
Svc To Motion Picture Prodtn 7819 7.1 4.7 -2.9
Motion Pict, Videotape Distr 7822 1.9 -0.6 9.3
Motion Picture Theaters 7830 0.7 -3 4.1
Video Tape Rental 7841 5.6 4.1 -6.1
Amusement & Recreation Svcs 7900 4 6.4 6.8
Racing,incl Track Operations 7948 2.3 -2.5 -4.1
Amusement & Rec Service -- Misc 7990 1.8 -2.8 1.3
Amusement Parks 7996 5.5 -14.9 -2
Sport & Rec Clubs Memberships 7997 3.1 4.2 3.6
Health Services 8000 4.5 -18.8 -1.2
Offices Of Medical Doctors 8011 0 -9.9 -14.1
Skilled Nursing Care Facility 8051 0.5 6.4 4.4
Hospitals 8060 0.3 2.1 8.1
Gen Med & Surgical Hospitals 8062 0.5 -22.4 5.1
Medical Laboratories 8071 0.1 5.7 3.3
Home Health Care Services 8082 0.8 5.7 8.8
Misc Health & Allied Svc, NEC 8090 0.1 5.4 5.7
Spec Outpatient Facility, NEC 8093 2.8 20.1 7.4
Educational Services 8200 9.8 10.8 15.8
Social Services 8300 1.4 -8.9 0.3
Engineering, Accounting, Research , Mgmt, Rel Svcs 8700 0.4 -23.1 0.6
Engineering Services 8711 0.3 8.9 0.8
Testing Laboratories 8734 0.7 13 8.5
Management Services 8741 0 -11.7 11.6
Management Consulting Svcs 8742 0.9 -3.2 -2.5

Note: Advertising Ratios & Budgets is compiled from a variety of government and published financial records. Since reporting may vary from company to company, careful use of the findings is advised. Caution is urged when: (1) financial events such as mergers, acquisitions, and divestitures may distort spending patterns; (2) private ownership of very large companies in specific industries may mean that some advertisers are omitted; (3) multi-industry companies are reported only in their primary industry based on sales of their dominant line of business. The data also may be impacted by missing data in company reports and by new companies entering into an industry, changes in business regulation and court rulings, and new ventures and changes in the level of business activity. Despite these potential limitations, Advertising Ratios & Budgets is quite useful when applied with imagination and judgment and combined with first-hand knowledge of the industry.         

Source: Schonfeld & Associates, 2011 "Advertising Ratios & Budgets" Study