Claire Beale on Advertising

Why the biggest bucks don't always mean the most beautiful adverts

Ads, ads, every which way. Our brands spend about £20bn on them every year. But who is the biggest advertiser in Britain?

Easy question. Procter & Gamble, of course. Has been for years. And they spent a whopping £202m encouraging us to buy Tampax/Fairy/Gillette etc last year, according to new figures unveiled last week by adspend monitor Nielsen.

More interesting, though, are some of the advertisers nudging P&G's number one spot. Runner-up in the bulging ad wallet stakes is the Government. Yes, adland's frenemy has elbowed into second place in the adspend league, spending a handsome £150m on ads urging us to stop smoking/ drink responsibly/join the Army/ wear a condom etc.

All of which is comforting proof that the Government recognises the power of advertising to do good, even if it likes to give the industry a sound kicking every now and then.

Unilever, once neck-and-neck with its fast-moving consumer goods rival P&G, cut its adspend by 15 per cent last year as it sharpened its focus on core brands like Flora, Surf and PG Tips.

If you followed the juicy spat between BSkyB and Virgin Media last year, when Virgin's channels were taken off the Sky platform, you won't be surprised to hear that the two media giants backed their teeth-baring with punchy ad budgets. Sky increased its spend on ads by a chest-puffing 58 per cent to £114m, making it the UK's fourth largest advertiser. But Virgin's staggering 500 per cent rise in spend only amounted to a £50m budget, puny in comparison.

Most of the spenders in the top ten are spreading their budgets over several brands. Not DFS, though. The sofa shop spent an eye-watering, and arguably media-polluting (depending on your view of the quality of the ads) £89m touting their wares. For its ad agencies, the low-profile Uber Agency and Public, DFS is big, beautiful business and, frankly, I'm sure they don't give a damn what the London creative coterie think of their work.

OVERALL, the country's top 100 advertisers super-charged their ad budgets by an extra 9 per cent in 2007. Adland will certainly be hoping that its biggest clients hold their nerve this year. A look at the corresponding agency billings figures from Nielsen tells a painful tale for some agencies.

Five out of the top ten agencies saw billings (the amount of advertisers' money they spend on buying media spots and space for their advertisements) slide. For JWT and Publicis, for example, a quarter of their billings were wiped out. Both agencies rely heavily on big blue chip, international advertisers.

A politically disrupted Beijing Olympics, an unsatisfactory conclusion to the presidential race, and the infectious credit crunch could all mute global ad budgets for the rest. Adland is holding its collective breath.

MIND YOU, you can spend what you like on advertising, but if people can't find your brand on the shelves, you might as well hand your entire marketing budget to your nearest supermarket-listed competitor.

Most of us buy most of our household essentials from the big chains – Tesco, Sainsbury's and Asda. But the big chains don't stock every brand and the fight for shelf space can be brutal. The supermarkets are now so big, and so powerful, that they've got brands by the balls.

So it was no surprise when the European Parliament announced last week that major supermarket chains are potentially abusing their dominant positions to drive down the prices they pay to their suppliers. Smaller brands are so desperate to gain shelf-space in the big chains that they can be held to ransom over the price at which they're prepared to sell their products.

But this merely echoed the findings of the UK's Competition Commission, which a few days earlier recommended a new code of practice for supermarkets and their suppliers. Now a new ombudsman will have the power to intervene if the supermarkets flex bully-boy buying muscle to squeeze brands and suppliers. Which is good news for small brands and suppliers, like local farmers, and good news for consumer choice.

Interestingly, though, Tesco is about to milk its powerful position by turning TV star. The store takes centre stage in a new reality TV show being billed as Dragons' Den Mark II. The concept pits small brands against each other in a bid to win space on Tesco's shelves.

Tesco – itself one of the UK's biggest advertisers, with a budget of £71m according to the Nielsen data – is the biggest supermarket chain and the most powerful. Getting your brand stocked in Tesco is no mean feat unless you're a bruiser yourself.

From anecdotal evidence, Tesco's buyers can make the brutally withering Dragons' Den-ers look like kittens, so it promises to be painfully compulsive viewing. It breaks next week on Five.

Tesco has clearly been sold on the idea that the programme could help improve its reputation and cast it in a more nurturing light. If reality TV history is anything to go by, fat chance. But then remember that Tesco is not a celebrity-wannabe ripe for exploitation at the hands of TV editors. What's the betting Five won't risk its share of that lovely £71m by turning Tesco over?

NEWS JUST in from US academics suggests that advertisers could be missing a trick with their campaigns. Forget entertaining us, making us laugh or putting a spring in the steps of consumers with a tuneful advertising turn. Apparently, we spend more when we're thoroughly miserable.

According to researchers from Harvard, Stanford, Pittsburgh and Carnegie Mellon universities, crawling from a black mood into the red is now a scientifically proven phenomenon. The study found that a target group who watched a depressing video about death were later willing to pay four times more for a bottle of mineral water than a control group who watched a video about the Great Barrier Reef.

Before you ask, this is not a simple case of retail therapy (or throat-scratching thirst); the academics have identified a depression-induced spending pattern that is utterly subconscious.

It seems that sadness can trigger a chain of emotions that encourages self-obsession and feelings of worthlessness, which then increases our willingness to pay more for brands.

Perhaps all those advertisers who spend their marketing budgets on campaigns that are harrowing in their awfulness are actually smarter than you might think. Perhaps it explains why DFS can afford to be the country's sixth biggest advertiser.

Claire Beale is the editor of Campaign magazine