Kids by Day, Adults by Night

Cartoon Network does a Nielsen split
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Cartoon Network executives are on a mission that sounds like a plot for
one of their own programs: A kids channel by day, Cartoon transforms into an
adult channel late at night. Its secret power: young men, legions of them,
defeating Leno, Letterman and even Conan.

Cartoon Network plans to tell advertisers this week that Nielsen will no
longer treat the channel as a single 24-hour network. At the end of March, the
ratings firm will break out sizzling Adult Swim block as a distinct part-time
service, separate from Cartoon Network.

Viewers won't notice a thing. Adult Swim will remain the late-night
block on the same channel slot as Cartoon. But when media planners are
crunching data to reach young men, Adult Swim will now pop up as an individual
channel, its average audience numbers unpolluted by the children who dominate
Cartoon's audience. The block runs from 11 p.m. to 6 a.m. six nights a week.
(Cartoon Network's “Fridays” kids block is too lucrative to bump.)

A Billion in Late Night

Late-night programming is one of the most profitable places in
television, accounting for around $1 billion in annual ad sales. Cartoon is
looking for a much bigger slice of that. “We have a tremendous amount of
opportunity in this daypart,” says Mark Lazarus, president of Turner
Broadcasting System's entertainment group. “The audience has found us and
finds us attractive. The marketing community, we're continuing to go through
the education process.”

The move follows the lead of kids network Nickelodeon, which did the
same thing in April with its longtime programming block, Nick At Nite. That
network now shows up in ad buyers' systems as a separate network, heavy with
adults 25-54. That move was controversial and, at the time, sparked a protest
by other networks. More on that later.

Adult Swim has been a ratings breakthrough. Even though it runs during
the hours when TV viewing is low, it averages more than a million viewers,
which would make it a top-10 cable network. The big lift came from the
acquisition of two busted series from Fox Broadcasting, Family Guy and Futurama. Both were cancelled, and Cartoon picked them
up for about $150,000 per episode, a bargain price for an off-network
half-hour.

But their ratings were a big score by cable standards and bubble toward
the top of the cable charts each week. Family
Guy
reruns and DVD sales are so strong that Fox is bringing the
series back to its prime time schedule.

Adult Swim excels among young, male viewers, consistently beating not
just other cable networks but the broadcast network's late-night talk
shows.

For example, the total audience for NBC's The
Tonight Show With Jay Leno
is far larger than that for Adult Swim.
But Adult Swim outpaces Leno by 45% among men 12-34, by 64% among men 18-24 and
362% among men 12-24. The lead over Letterman is even bigger: 79%, 118% and
375%, respectively.

It's the same story against NBC's Conan
O'Brien
and even ABC's Jimmy Kimmel
Show
.

The late-night talkers are not exactly skewed toward young folks.
Conventional wisdom holds that older adults go to sleep, but Brad Adgate senior
vice president, corporate research, for ad buyer Horizon Media, notes that the
median age of Leno and Letterman audiences exceeds 49.

Ad buyers targeting young men spend in late night because that's one
of the few places to find them. When young men watch TV, it's often after 11
p.m. Lazarus recalls that, when he was an ad buyer on Miller Brewing's
account, it was all about “sports and late night. That's where we spent our
money.”

Adult Swim starts stalling out among viewers over 24 and does terribly
among women, even younger women. But young men are hard for advertisers to
find, so Cartoon has a valuable commodity.

The network wants to get paid more for those men. Adult Swim generated
$70 million in ad sales last year, about 25% of the network's total sales.
But buyers for some ad categories, like auto, still see Cartoon Network as
primarily a kids network.

Success, Lazarus says, requires “breaking down some traditional
mind­set of what Cartoon is.”

Nick At Nite is the template. MTV Networks figured out years ago that it
couldn't sell much kids advertising at night, so they clearly branded and
programmed their kids network as the home for classic television. Still, they
have long been reported as a single network.

Separation anxiety

Last April, Nielsen started reporting them as two networks, drawing
howls from other cable networks. Suddenly, Nick was the top-ranked basic-cable
network in prime time on the strength of a single hour of programming. And the
split artificially pushed some smaller networks down.

And who was leading the protests? Jack Wakshlag, Turner Broadcasting's
chief research officer. He led a group of network researchers to push Nielsen
to revise its policy. The research agency made one concession, dropping Nick
from the rankings of prime time channels because it programs only nine evening
hours weekly.

But Nick At Nite remains in rankings of networks for “total
programming day.” In the most recent weekly ratings, Nick is No. 1 and Nick
At Nite No. 3, keeping ABC Family out of the top 10.

Adult Swim will push smaller networks down another notch. Wakshlag says
Cartoon is simply following the standards set by Nielsen. “These are the
rules of the game,” he says. “We should see how we could take advantage of
them to help our business.”

Change may not be quick. Nick At Nite has seen new buzz but not dramatic
sales gains.

Wakshlag sees only upside. Adult Swim will generate more money than
late-night kids shows do. “Remember, it's a daypart that we'd be doing
nothing in.”

E-mail comments to
jhiggins@reedbusiness.com

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