Children's Upfront Is Back on an Upswing

Tight supply means higher prices for kids-TV buyers

The kids are back in play. The kids upfront market, that is. After a few rough selling seasons, children's TV is fetching higher prices from advertisers that find themselves chasing fewer avails.

With about 70% of Nickelodeon's upfront deals closed, the market is progressing quickly, said Jim Perry, senior vice president of ad sales for Nick. "We expect to have it all wrapped up before the adult cable market kicks off [in June]."

Children's total take is expected to rise between 8% and 12% on single-digit increases in costs per thousand (CPMs), the programmers say. Last year's upfront generated between $700 million and $800 million in sales.

Predictable kids categories like toys and package goods are leading the market. Entertainment, particularly movies and videogames, are also contributing.

Perry attributes the price increases to a decline in supply. Kids programming options have been shrinking. Fox and ABC Family, for instance, have trimmed their kids blocks.

Viacom's Nickelodeon and AOL Time Warner's Cartoon Network are the dominant players. Both typically rank among the top five of all cable networks in prime time and total day. Walt Disney Co.'s Disney Channel, while highly rated, does not sell traditional advertising or participate in the upfront front. Sister net Toon Disney, which averages a modest 0.4 Nielsen rating, does sell ads and gets the upfront push from Disney's ABC Cable sales force.

Unlike in adult TV, where broadcasters send their repeats to cable, in kids programming, it is the cable networks that lead. On Saturday mornings on three broadcasters, Nickelodeon's Nick Jr. block plays on CBS; Discovery Kids airs on NBC; and ABC Cable programs and sells ABC's block. The cable networks sell the ad inventory.

With all these players, the kids market is clearly "much more complicated than just one buy," said Julie Friedlander, Zenith Media senior vice president and account manager.

Take Cartoon, for example. Its ratings are down, and it's missing a big new hit show (Nick has several). But, says Friedlander, "Cartoon is a smart buy because they still do decent numbers and they are much more efficient [than Nickelodeon]." And Cartoon sells time for Kids WB.

Cartoon says it has closed about 50% of its upfront inventory so far.

Even with a limited number of kids programmers, media buyers say there is hardly any one that is a must-buy.

"They all have strengths and weaknesses, but they are all very different," said John Wagner, Starcom Entertainment media director and kids negotiator. "They don't compete on the same platforms."

Nick is the ratings leader and boasts hits SpongeBob SquarePants
and Fairly Odd Parents. Cartoon Network scores with boys and offers its young-adult nighttime block Adult Swim.

Disney's Toon Disney caters to kids 2-11 with shows like Aladdin
and The Little Mermaid, while ABC Family's after-school hours appeal more to boys with shows like Mighty Morphin Power Rangers.

Discovery Kids, which airs on NBC's Saturday-morning block, tends to program more live-action and high-brow shows, such as a kids version of TLC's hit Trading Spaces.

Disney bundles its kids options together for advertisers, selling them time on Toon Disney, ABC Family and a piece of ABC Kids on Saturday mornings.

"People realize you can reach kids on cable, but there is still a need to reach non-cable, and that's on the weekends," said Kerry Hughes, vice president of kids sales and marketing, ABC Cable.

Hughes, who has concluded nearly 60% of her deals, says there has been renewed interest this year from smaller package-goods and candy companies.

Discovery Kids is in active negotiations and has closed some business, a spokesperson said.