Spengler on Health of Ad Market5/12/2006 08:00:00 PM Eastern
With broadcast TV's annual ritual, the upfront ad market, under way in New York, the wraps come off new shows and schedules. Then dealing begins for network sales executives and media buyers. Despite some early show pickups, everyone expects a few surprises. Before heading off to the presentations, Tim Spengler, director of national broadcast for Interpublic Group's Initiative Media, talked with B&C's Allison Romano about the health of the market, why new media isn't so big and how Grey's Anatomy could change everything.
Analysts and sellers are predicting a soft, slow-moving upfront market. What's your read?
Traditional media and national TV are experiencing a flattening of demand. This will be similar to last upfront, when the money was off a little bit. Total advertising in the country is only growing 4%-5% right now, and, of that growth, we're seeing more being spent closer to triggering the purchase, as opposed to building awareness. The upfront is still a huge business and one of the first buckets for advertising money. But many people are putting new money and some existing dollars further into the purchase cycle and to test new media.
The Big Four networks are pushing new-media products hard. How much will the Internet and digital distribution play into upfront deals?
I don't think it will be a big factor in where the money goes. For a handful of clients, it will be a small factor, the ones who want to be the first to get in. But I don't think they are going to swing a lot of money. We see young brands shifting money or the big brands and big categories that have the money to test and want to look innovative. But these platforms are not moving the sales needle today. It will take widespread use, more consumer demand and more consumer use. It is a few years away.
Several networks have committed to new programs even before the upfronts. Does that help sway advertisers their way?
It makes them appear stronger pre- presentation week. There's a solid idea that they know where they are going, and, in pre-sell, it might give them a perceptual lift. But that would go away if the clips fall flat or the pilot isn't good.
When a network is coming off a down year, how much of a hangover is there on the next year's sales?
You have to rely a little on gut instinct. You have to try and support the network if you like the fit for your brand and think consumers will like the shows. We all want to support those and take our best guess. The other issue becomes, what is the cost premium for that network? The relative cost base of each network is as important as whether we like the one-third of their schedule that is going to be new.
We've been through the reality craze and the Desperate Housewives sensation. What's the next hot genre?
Shows that are serialized in nature with defined beginning and end points. We know when the shows will be on and when they will be over and that they won't be littered with a lot of repeats. The high drama with time-sensitive nature. Some of our clients are interested in sponsorships in these shows; it's one of a number of ways to stand out. It's an expensive way, but we are thinking about it.
What are the big battleground nights for next season?
The most interesting night will be where Grey's Anatomy moves, if it moves. We've heard maybe Monday or Thursday. Also, Friday is coming out of the ashes and [becoming] more important to many advertisers than it was five years ago. The lead-in to the weekend is not just Thursdays, and it is important for all retail, movies and car companies.