Sears, Roebuck and Co., saying it expects a recession next year, yesterday cut its advertising spending by 7 percent for 1979.
Sears is the nation's biggest retailer, the largest single retail advertiser, and bellwether for the retail industry.
The company said its total ad budget will be cut to $482 million from $519 million. In addition to recession fears, Sears said it also was revamping its advertising strategy.
The reductions will cost the nation's publishers and broadcasters $37 million, with most of that amount coming out of the radio and television advertising budget, according to Sears.
The impact on the media could be far greater if other major retailers follow Sears lead. Although there has been talk of big stores cutting their advertising, that has not happened yet, said John Morton, a newspaper industry analyst for John Muir & Co. in Washington.
Sears' action reflects the traditional response of retailers to the threat of a recession - lowering their sales targets and reducing their advertising.
Increased advertising can maintain a retailer's sales for a few weeks when the economy starts to slow down, but advertising enough to buck a recession can hurt profits more than it helps sales, retail economists say.
A Sears executive yesterday repeated the company's assessment that, "we see a slowdown in the middle two quarters of the year" with sales falling to "recession levels."
In another major advertising development yesterday the New York Times raised its ad rates, boosting the cost of an agate line in the Sunday newspaper by 7 percent to $7.60 from $7.10.
Fred D. Thompson, The Times' vice president for advertising said the inceases will carry with the type of ad, but will fall within the Carter administration's voluntary price control guidelines.
The cutback in ad spending by Sears had been expected and was not as great as some observers had feared. Speculation about the cuts followed the announcement three weeks ago that Sears in changing its marketing and advertising strategy and plans to reduce its spending.
Sears' corporate strategy now is to de-emphasize price promotions and accept a slower growth in sales in hopes of increasing its profits.
Gar Ingraham, the company's vice president for retail sales, said Sears will spend about $354 million on advertising in local markets and another $115 million on national advertising.
The biggest cuts are expected to be in national advertising and in radio and television spending. Sears also is shifting more of its advertising money into pre-printed supplements and spending less on regular newspaper ads.