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Dollars and Sense

Financial-news shows stay solvent by broadening their mission and expanding their advertising base 4/25/2004 08:00:00 PM Eastern

Wall Street is a fast, avaricious world where money and power reign supreme. And most Americans, envious of the wealth, want a piece of the action. For those who will never enter the inner sanctum of Goldman Sachs, financial TV programming is the next best thing. Here, hot stock tips and professional insights inform viewers on everything from how to leverage their mortgage to how to invest for retirement. Think of it as watching your way to financial security.

The trick is luring viewers—back.

Hey, Big Spenders
The top financial advertisers spent a total of $106,116.23 on TV last year. Spending in the category seems to change with the stock market and scandals
Rank Company Broadcast Net. Cable Spot
Source: CMR
1 Morgan Stanley Dean Witter $55,167.30 $31,975.20 $3,206.69
2 Charles Schwab Corp. $27,922.10 $11,623.92 $4,149.09
3 FMR Corp. (Fidelity Investments) $23,854.30 $9,690.35 $538.03
4 Ameritrade Holding Corp. $55.60 $19,798.78 $19.01
5 Merrill Lynch & Co. Inc. $6,121.80 $7,490.49 $2,154.75
Total $61,289.10 $39,465.69 $5,361.44

During the heady dotcom 1990s, networks served a steady diet of investment fever, and shows like CNBC's Squawk Box
became must-see viewing for instant moguls. But when the boom went bust, audiences quickly tuned out, say media buyers. The audience for CNBC, CNNfn and Bloomberg TV shrank, while such shows as CNN's Lou Dobbs Tonight
and Fox News'Bulls & Bears
and Cavuto on Business
saw spot buys drop with the market. "Ad spending in the financial-services category fell off the cliff in 2001," notes Rino Scanzoni, president, broadcast division, WPP Group's Mediaedge:cia, New York.

Happily for television, spending has quietly returned over the past two years.

In fourth quarter 2003, ad expenditures from the financial-services category was up across all media by 17%, according to TNS Media Intelligence/CMR. That compares with a 5% increase for all categories overall. In TV alone, spending by financial-services companies was up 13%; all categories, up about 9%. Although those numbers are impressive, media buyers caution that TNS/CMR numbers for that cohort include credit cards and banks. Several major media buyers expect brokerages to be up significantly going into the upfront market next month.

"Since the market started rallying last April, it's opened up the purse strings from the mutual-fund companies and the brokerage houses," says a media buyer whose mutual-fund client spent more than $70 million on advertising in 2003. "Narrowing it down to just investment companies, there's been some movement upward in the single-digit range."

While networks are pleased with the revenue bounce, they—and their advertisers—remain fluid. For instance, network sales shifted focus. In addition to pitching financial-services companies, they've earmarked packaged-goods, automotive, and pharmaceuticals. "Our standbys have been cars and pharmaceuticals, both of which have been very loyal to us over the past few years," says Bob Leverone, vice president of television, CBS Marketwatch. "Going into our sixth season, we're seeing financial advertisers making a comeback. Oppenheimer and Harrisdirect, in particular, have come back. Even though there's more interest in the markets, we're trying to maintain a balance in terms of our roster of advertisers."

"We've all had to become much more consumer-oriented, more Main Street than Wall Street," agrees Ken Jautz, executive vice president, general manager of CNN's Business News Division, which includes the CNNfn network. "People want to know what will help them manage household wealth as opposed to short-term investment wealth."

CNN's finance-related properties, as well as its competitors, such as CBS Marketwatch,
aggressively pursued marketers like Procter & Gamble, General Motors, Sears, IBM, and Merck. Why? They are some of the heaviest supporters of finance-oriented TV programming, notes Brad Adgate, senior vice president, director of research for Horizon Media, New York.

Broadening its news is a boon to marketers, he adds. "As cable has become so niche in terms of programming, investment shows have been able to attract a select group of products, particularly in the luxury area. TV is not considered the most upscale of all the mediums, so, when you have access to those demographics, it's important. Finance shows represent a clear shot to reach the C-level executives and decision-makers watching TV."

Programmers have reacted to the changing marketplace.

"We have defined business news differently over the past year. It's broader," says Jautz. "We think the revival of business-news programming is because we changed to meet the needs of people after the bubble burst three years ago. People became interested in their overall financial health. Their interest was more in long-term savings and investing. There was less interest in day-to-day stock-market gyrations."

Consider the evolution of Lou Dobbs Moneyline, which became Lou Dobbs Tonight. The network embraced changes undertaken by the outspoken Dobbs, who is fond of discussing such issues as outsourcing. "The show's now about economic and political issues and the impact on us and on society," says Jautz. "It's an opinionated exploration of the news as opposed to four years ago, when it was strictly stock-market focused." The update worked. Moneyline
was at a 0.2 rating and "heading in the wrong direction," Jautz adds. It now averages a 0.5 rating.

For Leverone, the secret to maintaining a diverse array of viewers and advertisers is variety. "I'm going after the people who are interested in a little more than business," he says. "Bloomberg or CNBC will say, 'Wall Street traders turn to us in the morning' because they promise the latest market news from around the globe. Well, they're wrong! When traders open their eyes, they want to know who won the Knicks game, not just how an obscure Chinese stock is doing.

"They want to know if it's raining and what the temperature is. They want to know what's going on in Iraq," Leverone says. "When it comes to business people and information, it's not just about the market. It's everything."


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