War Slows Scatter Sales - Broadcasting & Cable

War Slows Scatter Sales

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April Fool's Day was the deadline for agencies and advertisers to exercise options to take back third-quarter upfront advertising commitments. But the joke could be on the advertisers if they opt out. The networks aren't laughing, though: Scatter sales have slowed significantly.

"Scatter is so much higher than upfront pricing," reports one key media buyer, "it will be interesting to see whether or not a lot of money is given back. But canceling is risky, especially if the war stops or the economy revs up."

Networks, of course, are mum on the topic. But, in these uncertain times, NBC has been scoping out the war on another front. Its research shows that viewers have a high tolerance for advertising despite the war. Over 84% of those surveyed say it's "appropriate" to advertise on late-night, morning shows and prime time entertainment programs.

As for scatter, "we're not going to get a true picture for a few weeks," says Bill Cella, U.S. chairman, Magna Global, "but I think people will hold their positions."

Tim Spengler, executive VP/director, national broadcast, Initiative Media, agrees. "I see very little cancellation."

Cella adds that third-quarter buying has slowed down.

"The war is having an effect," Cella says, "but this slowdown began before the war."

Such unease caused one major buyer to call recent reports of 15% to 20% upfront increases "silly numbers."

Spengler refuses to guess. "Nobody had budgets in yet," he says. "The networks are doing a good job fanning the flames about anticipated demand. But our intelligence is not showing that."

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