Hopeful, yet realistic

A look ahead at the area business climate

What’s ahead for our region’s economy, including crucial industries such as home building, commercial real estate, banking and retail, manufacturing and the media?

After a year in which a hot housing market turned cold, two local Fortune 500s absorbed major acquisitions and the future of the airport as a major airline hub was put into question, we asked our experts what to watch in 2007.

The Enquirer’s seven business reporters sought sources who could give us insight, however random or anecdotal, into the region’s economic outlook. Our experts range from commercial real estate brokers to investment gurus, university professors to a piano repairman.

On the whole, the group was optimistic. But areas that the experts say bear watching include Delta/Comair, new home construction, inflation and the auto sector (with Ford scheduled to close its Batavia plant in 2008).

MEDIA

Robert K. Riggsbee, president of Inside Media, a Newtown-based media research, planning and buying firm, says the local media climate in 2007 is clouded, but he projects a moderate 2.7 percent growth in Cincinnati advertising revenue from electronic, print and outdoor media.

“The major concern is that the three key media category indicators – automotive, real estate and travel – are forecast to continue trending down through June of ‘07,” he said.

With Clear Channel radio in flux because of major expense cuts, employee downsizing and its pending sale to two private equity firms, advertising rates should realize flat to moderate increases, he says.

Riggsbee says the big story in local media is the historic level of significant changes in the radio landscape that took place in the fourth quarter and how these changes will affect station pricing to the advertising community.

“Unquestionably, and at least through second quarter, it will be a buyers’ market, with stations all fiercely competing for their share of the advertising pie,” he said.

The Cincinnati television market is in good shape, meanwhile. “It is still the No. 1 mass medium, and more people in Cincinnati will watch more TV and cable in ‘07 than ‘06,” he predicted. “However, with no political dollars and no Olympics taking place this year, along with intense competition for some ad-supported cable networks (which are experiencing record growth), the local TV networks are under serious pressure to perform up to corporate budget expectations, thus putting advertisers in a better position to negotiate more favorable long-term deals this year as compared to last year.”