Channel Surfing
Television viewers have been migrating to cable channels, causing agencies and marketers to follow suit, much to the chagrin of broadcast networks. Last year, the cable upfront took in an estimated $6 billion (up from $4.8 billion in 2002), and that number continues to grow with the improving economy. Viewers are turning away from broadcast television and focusing on cable, the Internet and other non-traditional forms of media.
“I think that it’s fair to say that cable has truly come into its own as a respected and genuinely valued part of any media mix,” says Jim Chabin, president and CEO of PROMAX & BDA, an industry association that represents television executives and broadcast designers. “As little as five to six years ago cable was thought of as bulky, but I think that all of us have really come to acknowledge that you can’t have one without the other anymore.”
Each spring, the upfront presentation showcases new programming, during which television networks sell as much as 80% of commercial time even before the fall season kicks off. Advertisers and agencies are asked by TV networks to make long-term commitments well in advance of the upcoming television season.
Demand remains especially strong for cable TV this year as media-buying executives are still stung by last year’s 15% to 20% increase in cost of ad time during broadcast network programming. In relation to cable, broadcast brought in $9.3 billion over all six networks during 2003-2004.
“I am anticipating a shift of dollars from broadcast to cable at this year’s upfront. Incremental money will come in from autos and telecommunications,” says David Levy, president of Turner Entertainment ad sales and marketing. The question for the 2004-2005 upfront is: How much broadcast?
Media buyers are continuing to shift their advertising dollars to cable. The Jack Myers Report Advertising Confidence Survey shows that 62% of clients and agency executives think their cable budgets will increase in the 2004 upfront, with 36% thinking they will stay the same and only 2% predicting a decrease. Among media agencies, 66% say their cable budgets will increase, while 26% believe they won’t change and 9% predict a decrease. The average increase is 4%-5%, according to the report, an Internet-based survey of 300 conducted in the first two weeks of April.
“The recession taught us that all crumbs matter,” Chabin says. “In the ‘90s heyday, no one cared about cable. Now, every viewer is respected and every tenth of a ratings point counts. Viewers are more precious than ever — they are more valued by networks and advertisers alike.”
Broadcast networks have begun to take action through advertising. Three ads by NBC’s in-house advertising and promotions division, The NBC Agency, have been set to run in trade publications. The ads, backed by ABC, CBS, FOX, NBC, UPN and the WB, will carry the tagline “People who need people buy broadcast.” The first ad shows a New York City sidewalk filled with people. An arrow points to one person in the crowd and the text calls out, “This guy saw your spot on cable.”
Cable seems to have no intentions of getting lost in a crowd. Network television has already submerged under the 50% mark for total viewership, as people are tuning in to cable for hits like HBO’s The Sopranos and Bravo’s Queer Eye for the Straight Guy. Advertising across cable networks tends to be more affordable because there’s plenty of inventory to go around, keeping program prices from rising.
The average prime-time cable show is priced 30% below that of a broadcast network. Furthermore, cable networks like TNT offer limited programming with series consisting of 6 to 9 hours rather than 22 hours. This programming attracts high-profile stars and has less of a tendency to flop in the long run. Advertisers can also leverage products towards narrower audiences since cable programming appeals to niche viewers.
Syndication is yet another strong factor for cable, since audiences are familiar with the programming and enjoy watching episodes of Seinfeld and Sex and the City over and over again. A prime-time access show in syndication may also be 15% below that of a broadcast network in pricing.
Getting real
America’s fascination with reality television has continued to grow, and it’s no longer limited to broadcast programs such as American Idol or Survivor. Cable networks have begun to develop their own twists on reality, attracting the attention of viewers and advertisers.
“Instead of having five new shows that you’re working on, expecting some to fail, which was the model 10 years ago — you now have a new reality series,” Chabin explains. “Reality is real, it’s not a fluke, it is a truly groundbreaking trend and it is as significant as the talk show when it came out and as significant as the sitcoms that were being turned out in the 1960s.”
A&E’s upfront schedule boasts a full plate of real-life series and documentaries. Referring to its reality programming as “real life television,” the network is working to distinguish itself by following people’s real lives rather than putting real people into unreal situations.
“Reality has now become such a broad term. There are different types of reality shows-the reality game shows like The Apprentice or Survivor, and then there’s the reality that puts people in bad situations like Fear Factor,” explains Artie Scheff, A&E’s senior VP-marketing. “Where it’s really starting to take off is the ‘fly on the wall’ type of reality like The Osbournes — that is the genre we’ ve been exploring.”
A&E’s new programming includes Growing Up Gotti, which premieres Aug. 2. The reality show chronicles the life of Victoria Gotti, author, divorced mother of three teenage boys and daughter of the late Mob boss John Gotti. Dog the Bounty Hunter premieres Aug. 31 and documents the trials and tribulations of bounty hunter Dwayne “Dog” Chapman and his life and business partner, Beth.
“A&E is a network that is on the rise and is developing a lot of buzz programming, we are trying to become more current. Older viewers and younger viewers are still looking for what’s happening today. We want to attract younger viewers but not alienate older viewers,” Scheff says.
A&E’s Biography is still a tent pole for the network. A new marketing campaign targeting educated women and men between the ages of 25-45 begins this August. A&E is building on its partnership with photographer Annie Leibovitz to capture images of stars like Jerry Seinfeld, Muhammad Ali, Steven Spielberg, Harrison Ford and Jamie Lee Curtis in a TV and print campaign. The campaign was created by A&E Network Marketing in conjunction with TBWA/Chiat/Day New York. Saks Fifth Avenue in New York will feature the campaign with window displays and a sweeps.
The Discovery Channel is also catching up with the reality craze, launching its new series No Opportunity Wasted (NOW!) for fourth quarter 2004. Hosted by Phil Keoghan, NOW! is about seizing the moment and creating a once-in-a-lifetime experience. Program participants are chosen from online submissions and selected based on the creativity of their dream.
“This show makes dreams come true and gives you what you need to have that dream happen,” says Adam Stewart, VP-national sales manager for Discovery Channel. “It’s adventure programming with a heart.”
Though not part of an upfront deal, Chrysler is the exclusive automotive sponsor of the upcoming series. The partnership features Chrysler’s 2005 300C sedan, which Keoghan will drive around the country to notify contestants that they’ve been chosen to live out their dreams. In addition to category exclusivity, the partnership features the 300C in the opening of each episode of NOW! and Chrysler will also receive other product integration opportunities throughout the series and will be featured in co-branded customized vignettes airing on the Discovery Channel.
“In this show the car is almost like a central character. Chrysler is trying to get across its brand message of inspiration through the show,” Stewart says. “Product integration has become a central part of many marketers’ plans and we aspire to hold the standards of integration incredibly high. Forcing integration doesn’t work; it’s not good for the viewer or the marketer.”
The deal also consists of an iMedia element, which includes co-branded online promotional materials and logo inclusion on Discovery.com. Other elements of the deal include a direct mail campaign promoting the partnership to Chrysler’s target consumers and promotion on television monitors in Discovery Channel retail stores across the country.
Blending reality programming with syndicated comedies, Turner Broadcasting System (TBS) is launching Sex and the City, Everybody Loves Raymond and Yes, Dear alongside original reality fare in an attempt to target young adults. This summer the network will debut a new logo, tagline (“TBS Very Funny”) and ad campaign via Publicis, New York, as part of its new brand initiative.
“The TBS brand will further differentiate the network while targeting desired young adult demographics coveted by advertisers,” says Steve Koonin, executive VP and chief operating officer for TBS and Turner Network Television (TNT).
New reality programming includes Gilligan’s Island, from the producer of The Bachelor, which is set to premiere fourth quarter 2004. The show will feature a real-life skipper, first mate, millionaire couple, movie star, Kansas farm girl and professor that will all work together to try to get off the island. Outback Jack puts 12 pampered city women to the test as they vie for the affections of a rugged Australian adventurer.
“We are selectively putting reality programming around our other programming so it creates a natural flow. Outback Jack will run before our launch of Sex and the City in aspirations of winning that audience,” says Levy.
A longtime pioneer of reality programming, MTV Networks has tried a new strategy for its upfront this year. MTV Networks will offer advertisers a new ad-buying strategy in order to directly compete with broadcast networks — combining ad inventory across networks. MTV will also offer its “Ten Spot,” a 10 to 11 p.m. prime-time block of shows, as a separate, discounted buy.
MTV Networks deliver the largest reach among adults 18-49 of any cable network group. A division of Viacom, the company consists of MTV, VH1, Comedy Central, Spike TV, Nick at Night and other niche networks. While marketers can still buy spots on MTV Networks individually, the company is trying to entice them with this new ad buying strategy that boasts a broader reach.
Other reality programming set to drop in 2004-2005 include Bravo’s Queer Eye for the Straight Girl, which capitalizes on the success of Queer Eye for the Straight Guy. Pilot Season is a 10-episode series that brings viewers into the world of television production as the search for the hottest undiscovered writing talent begins. Naked debuts in 2005 and presents a twist on the traditional TV biography and talk show formats. Forty Deuce, also in 2005, is a docudrama that explores the lives of dancers at Hollywood’s burlesque club of the same name.
Lifetime enters the world of reality this fall with its new series from the producers of American Idol titled How Clean is Your House based on the popular British comedic series of the same name.
The Learning Channel (TLC) has had success with shows like Trading Spaces and While You Were Out and continues its reality stint with two new series, Plastic Surgery, a look into the everyday happenings at a plastic surgery practice, and The Designers, which follows wildly expensive and in-demand interior designers around the globe.
Kid-friendly
Advertisers have not underestimated the buying power of kids and the influence they hold over their parents. This year the kids upfront market is seeing ad prices rising 20% over last year. Categories that have increased TV spending include DVD and video sales, electronics, video games, toys and movies. Packaged goods fell flat this year. QSR companies have been shy at this year’s upfront, perhaps wary of proposed federal regulations that may target TV food advertising to children. Overall, kids advertising revenue has grown 5 to 10% over the $750 million in national kids TV advertising of a year ago.
“This year’s kids upfront was successful for both Cartoon Network and for Kids’ WB. There is definitely more money in the marketplace,” says Levy. “We have experienced high double digits in revenue growth and in CPM growth. The movie, gaming and toy businesses have all stepped up this year.”
Pulling in $231.9 million in advertising revenue last year, Cartoon Network will premiere several new shows for the 2004-2005 season. Foster’s Home for Imaginary Friends premieres in September and tells the story of Mac, a smart, creative and shy eight-year-old and his imaginary friend Bloo; Justice League Unlimited premieres in August as Batman, Superman, Wonder Woman and Green Lantern continue to lead the universe’s most powerful superheroes in an effort to stop criminal plots; Atomic Betty debuts in September and follows the adventures of Betty, a little girl with a big secret (she’s a hero to the universe) and Hi Hi Puffy AmiYumi debuts in December following the adventures of two pop stars from Tokyo.
Nickelodeon celebrates its 25th anniversary this year with nine new live-action and animated series for the 2004-2005 season including a starring vehicle for All That cast member Jamie Spears (Britney Spears’ sister); Unfabulous, an original, live action comedy starring Emma Roberts (Julia Roberts’ niece); The Power Strikers, a live-action comedy about the adventures of an all-girl soccer team created and produced by Whoopi Goldberg, and Go, Diego, Go!, an animated preschool series centering on the cousin of Nick Jr. heroine Dora the Explorer.
This new programming line-up could mean big bucks for Nick: according to TNS Media Intelligence/CMR, the kids network pulled in $844.1 million in advertising revenue in 2003.
Disney Channel remains free of any advertising and as a result, the network has hurt advertising-supported kids TV ratings by usurping advertising points from ad-supported TV programmers. Its ratings have risen substantially over the past several years and the cable network will premiere two new original series this summer, Phil of the Future and Disney’s Brandy & Mr. Whiskers.
For the kid in all of us, Cartoon Network debuted its first annual “Adult Swim” upfront presentation this year. The late-night cartoon programming block starts at 11p.m. on Sunday through Thursday nights and is aimed at the 18-34 demographic.
New shows and pilots set to debut for 2004-2005 include: The Venture Brothers, a new comedy beginning Aug. 8. The show follows the adventures of two dim-witted brothers, their scientist father and his bodyguard, Brock. Squidbillies airs this fall and chronicles the life of a family of squids stranded in the North Georgia mountains. They are remnants from five million years ago when water covered the Earth. Seth Green will star in an untitled project set to debut in October. Tom Goes to the Mayor explores the comedic possibilities of government machinations and provincial thinking. Finally, Stroker & Hoop is the story of John Stroker, a private eye still mastering his craft, and his partner Hoop, a self-proclaimed master of disguise.
Cartoon Network’s “Adult Swim” has gained quite the following since its debut in 2001. New licensees and retail partners have jumped on board to introduce new products to stores in 2004-2005. DVDs, apparel and collectibles are currently on store shelves and new merchandise such as toys and novelty gifts are slated to debut in 2005.
“‘Adult Swim’ is the hidden treasure in the Turner portfolio,” says Levy. “It is resonating at colleges and DVD sales have skyrocketed. The DVD collection set has sold over 250,000 units to date. We expected only 50,000 to sell.”
Tennis, anyone?
Each year cable network execs try to wow advertisers with flashy upfront presentations. MTV did it with an Elton John concert at Madison Square Garden, and Cartoon Network held a party in Tribeca for its ‘Adult Swim’ presentation complete with people costumed as bears, rabbits and space explorers.
The Tennis Channel chose to go a different route by engaging potential ad execs in a little game of what else? Tennis. Barely a year old, the new network presented Spring Smashoff (a mixed doubles tournament in Manhattan) to generate buzz.
“To dovetail into our upfront presentation, we kicked off a battle of the agencies,” says Faye Walker, VP-marketing for the Tennis Channel. “During the tournament people got to really notice us. It was a direct marketing appeal of the product that we’re bringing to the table.”
The upfront presentation is just another example of the Tennis Channel’s innovative marketing strategies. The network gave out giant Pete Sampras-autographed tennis balls to their affiliates and sent Tennis Channel-branded table tennis tables, paddles and balls to advertisers for the holidays.
To generate hype for the movie Wimbledon, the Tennis Channel will air interviews with the stars and the making-of-the-movie this fall and provide a sweeps for fans to win a trip to the famed tennis mecca.
“We’re trying to get more people excited. Our whole goal is to make everyone a fan by promoting to our affiliates, advertisers and viewers,” Walker says.
