Spots N Dots
The Daily News Of TV Sales
October 13, 2016
MAGNA MORE BULLISH ON U.S. AD MARKET
STRONGEST GROWTH SINCE 2010
The updated forecast from Magna, part of IPG Mediabrands, sees U.S. advertising revenues growing by 6.3% this year to $179 billion. That’s up from the previous 6.2% growth forecast in June and would be the strongest growth for U.S. media revenues from advertising since 2010, which saw 6.6% growth.
Magna’s upward revision follows strong first-half of 2016 performance by National TV, up 4.6% excluding political and Olympics “thanks to a strong recovery in pricing offsetting the continued decline of ratings supply. The full-year forecast is now for 3.2% growth, although that’s seen as slowing to 1.5% in 2017.
Local TV advertising is expected to shoot up 10% this year to $23 billion, but drop by 11% next year—obviously due to election cycle. “We cut our forecast for incremental political ad sales to $2.8 billion this year due to latest signals of lower-than-expected GOP spend in the general election,” the Magna forecasters noted. Excluding political, the forecast says Local TV ad spend would be down 1% in both 2016 and 2017.
Digital media advertising continues to grow by double digits. Magna forecasts that digital will grow 15% this year and effectively tie total TV advertising (National and Local) at about $68 billion. Digital will continue to grow 12% in 2017 and reach $105 billion by the end of the decade, Magna says, which would give it a 51% advertising market share. The main digital ad drivers are social media, predicted to be up 44% this year, and online video, up 32%.
But not all of the movement is to digital. “Some advertisers in the Consumer Packaged Goods (CPG) sector have publicly said that their digital media ad spend had proved disappointing in terms of ROI, which had prompted them to re-allocate more dollars to traditional TV. In fact, advertisers overall did not reduce their digital advertising in the first half, since it grew by an impressive +18%. Advertisers instead grew digital and national TV ad spend, at the expense of print and radio, and thanks to a dynamic national media spend overall,” said the Magna update. “We believe that the fundamental reason behind the current strength of demand for linear national TV is that large consumer brands in key categories like CPG, personal care or entertainment, still depend on national TV to deliver volume and reach and they don’t perceive digital alternatives to be perfect substitute yet. Part of the issue is likely coming from the fact that cross-screen, cross-platform audience measurement is not universally available yet,” the forecasters wrote.
If you look at video advertising as one big multi-screen world—encompassing TV and all online platforms—Magna is predicting that growth over the next four years will be at a compound annual growth rate (CAGR) of 7%, while holistic audio (radio and audio streaming) will plateau at a -1% CAGR. Holistic print (newspapers and magazines, print and digital) are seen declining by a 7% CAGR.
ADVERTISER NEWS
Amazon will launch a chain of bricks-and-mortar convenience stores as it moves deeper into the grocery business. The Wall Street Journal reports the stores will initially be exclusive for members of Amazon’s Fresh subscription service, which lowered membership fees just a few days ago. Right now Amazon has just a 1.1% share in the highly-competitive, low-margin food business, chasing leaders Walmart (17.3 share), Kroger (8.9), Albertsons/Safeway (5.6), Costco (5.1), and Publix (3.4)……Ford has scheduled a short halt in Mustang production at a factory in Michigan after the model’s sales were down 32% last month and were surpassed by Chevrolet’s Camaro for the first time since October, 2014. Incentives may have played a big part in that reversal—J.D. Power data found Camaro incentives averaged $3,409 last month compared to $2,602 on the Mustang. Mustang sales are down 9.3% for the year’s first nine months……Here’s some disturbing news from S&P Global Ratings that could have an impact on automotive sales going forward: Subprime delinquencies (more than 60 days behind in payments) rose to 4.85% of loans by August, the highest level of problems since January, 2010. Federal Reserve data showed that 94.8% of applications for car loans were approved in the year that ended last October and S&P commented “The auto industry has…become intensely competitive, which has led to price competition, loosening of credit standards, and higher charge-offs”……As we approach Thanksgiving, Back Yard Burgers is launching the Autumn Turkey Burger as a limited time offer that ends four days before the holiday……As if the proposed merger between Cigna and Anthem didn’t have enough problems with the Justice Department refusing to approve it, NewsCorp’s New York Post is now reporting the two companies are feuding ahead of the court case next November in which they’re supposed to defend the proposal. The paper says Cigna is irate at Anthem because it feels Anthem has not adequately prepared its case against the Justice Department and Anthem is alleging a breach of the deal by Cigna for not providing documentation to regulators in a timely manner……Toy designer and manufacturer ThreeSixty Group has bought the FAO Schwarz brand from Toys ‘R’ Us. Schwarz no longer operates any physical stores, but still markets toys with that brand. ThreeSixty owns and distributes other brands including Sharper Image, Discovery Kids, Smithsonian and Animal Planet.
NETWORK NEWS
The Toy Box, a new competition series, will make its way to ABC sometime in the 2016-17 season. The program will be hosted by Eric Stonestreet of Modern Family, and will feature a set of amateur inventors running their designs through various trials, aiming for a spot in the finale. The finalists will have the opportunity to pitch their designs to a panel of kid judges. The winner will have their toy brought to market by Mattel. The toy-making giant is producing the series though Mattel Creations along with ABC……NBC’s Law & Order: SVU has announced a new “ripped from the headlines” episode for October 26th. The long-running crime drama will air a program about a politician whose campaign has been damaged by many women coming forward with accusations against him. Gary Cole will play a character much like Donald Trump, a wealthy man who decides to run for president. The episode titled Unstoppable will air Wednesday, October 26th at 9 PM (ET)…… Raul Castillo has been picked for a recurring role on The CW’s Riverdale, a modern take on the Archie series of comic books. The midseason drama will take a closer look at the surrealism of small-town life. Castillo will play a serious, successful songwriter from New York and a visiting professor at Riverdale’s Carson College. Castillo is best known for his portrayal of Richie on the HBO comedy, Looking……FOX has given a full-season order to its new prime drama, Lethal Weapon. Fox Entertainment president David Madden said in the announcement, “Lethal Weapons delivers an explosive and wildly entertaining core relationship between two cops, with dynamic performances by Damon Wayans and Clayne Crawford, surrounded by cinematic action, endearing humor and true heart.” The TV reboot of the movie franchise of the same name leads off Wednesday night for FOX at 8 PM (ET). NBC’s This Is Us, ABC’s Designated Survivor and Speechless have also received full-season commitments……Jane Pauley’s first show as CBS Sunday Morning anchor delivered a 12% increase in total viewers over the same Sunday in 2015. The total viewer number from Nielsen was 5.66 million. In the news demo of A25-54, the program posted 1.41 million viewers, plus 27% over last year. The totals did not include Hurricane Matthew impacted markets Orlando, Jacksonville, Raleigh-Durham and Norfolk. CBS Sunday Morning has enjoyed double-digit improvement season to-date from 2015-2016, and has been TV’s most-watched Sunday morning news program for 16 consecutive broadcast seasons.
TUESDAY RATINGS
NBC has reason to smile after the Nielsen ratings were released for Tuesday night. The freshman drama This Is Us actually led the night among 18-49s by posting a 2.8 demo rating in its new time slot at 9 PM (ET). That was three tenths of a point higher than its lead-in, The Voice (2.5) and a full point better that its lead-out, Chicago Fire (1.8). Among the other new fall programs, ABC’s American Housewife delivered a 1.8, The Real O’Neals did a 1.2 and The CW’s No Tomorrow did a 0.3 in their season premieres, while Bull on CBS did a 1.6. For ABC, the season premiere of The Middle posted a 1.7 demo rating, while Fresh Off the Boat did a 1.5 and Agents of S.H.I.E.L.D managed a 0.9 rating at 10 PM (ET). On CBS, NCIS did a 1.7, and NCIS: New Orleans got a 1.2 rating. It was a tough night for FOX with the Brooklyn Nine-Nine/New Girl crossover only posting a 0.9 rating and Scream Queens only pulling a 0.7. The Flash on The CW hit a series low with a 1.0 rating. Telemundo’s primetime average was a 0.7 and Univision averaged a 0.6 rating in the demo.
WEEKLY RATINGS
CBS and The Big Bang Theory can claim the win as the top scripted program for the week of October 3rd. This is the first time since January 26th, 2015 that Empire on FOX has not held that position. The Nielsen 18-49 rating for the long-running CBS sitcom was 3.5, just a tenth of a point ahead of Empire (3.4). The Monday version of The Voice on NBC delivered a 3.0 in the demo, while 60 Minutes on CBS posted a 2.6. Of course, football was the ratings king for the week with the Giants/Packers game on NBC Sunday Night Football placing first with a 5.9 rating, and the Thursday Night Football Cardinals/49ers match up on CBS delivered a 4.1 demo rating. Debate analysis on CBS placed in the top 10 with a 2.3, followed by Grey’s Anatomy with a 2.2 rating. Kevin Can Wait performed best for the newcomers by posting a 2.2 rating and Speechless on ABC came in with a 1.8, tying with the Timeless premiere on NBC. Lethal Weapon on FOX was the only other new series in the top 25 with a 1.7 demo rating.
COMPETITIVE INFO
Local TV is getting more competition as GateHouse Media beefs up its video advertising business in a deal with Genesis Media. The effort to deliver digital video ads using Genesis Media’s real-time analytics platform will be implemented across 217 GateHouse Media digital platforms. GateHouse, which owns 125 daily newspapers, is particularly targeting political advertising right now—claiming that premium video opportunities for political advertising has been limited until now in key political markets, including Ohio, Pennsylvania, Colorado and Florida.
SPORTS RIGHTS CONTINUE TO RISE
The sports practice at PricewaterhouseCoopers (PwC) projects that the North American sports market will grow from $63.9 billion in 2015 to $75.7 billion by 2020,largely driven by risingmedia rights and sponsorship. PwC forecasts that media rights revenues may rise at an annual rate of 5.5% to $21.3 billion by 2020 and are projected to exceed gate revenues as the sports industry’s largest segment within the next two years.
"Broadcast rights preservation is likely to remain industry priority through at last the next deal cycle, which will lead most properties to avoid major disruption of existing distribution and potential further dilution of rights fees,” states the PwC report. Even so, PwC sees digital rights as a growth area for sports businesses.
KANTAR ADDS CROSS-PLATFORM TRACKING
Add-tracking company Kantar Media announced the addition of data on programmatic, mobile, social and cross-media video to its services. With the new capabilities, which provide data and insight into all key digital platforms for millions of brands, WPP-owned Kantar Media claims to be the first industry source to provide competitive ad intelligence solutions for a comprehensive array of legacy and digital media channels. The expansion will be integrated across the company’s suite of offerings for agencies, brands and media sellers, starting in the U.S.
“It is clear that advertising dollars are not only shifting to a variety of digital platforms, but that competitive ad intelligence now needs to be approached in a very holistic manner,” said Andy Brown, Chairman and CEO, Kantar Media. The company says we are now in a post-silo media channel era, where analysis for media buyer and seller alike needs to include all channels.
ACCOUNT ACTIONS
USAA has consolidated its business at Publicis Groupe, which has built a Power Of One team specifically for USAA that integrates services across three of Publicis Groupe's four Solutions hubs: Publicis Communications, Publicis.Sapient and Publicis Media. As part of the contract, Publicis has pledged to hire 30% of its new employees on the USAA account from “diverse communities,” the insurance company said in a statement. USAA had dumped Campbell Ewald after one of its employees on the USAA account sent a racist email that was leaked to the public in January……Harmelin Media has been named media planning and buying agency for Medical Alert, whose new Medical Alert MobileElite system features GPS technology for emergency assistance. Harmelin Media will design Direct Response TV campaigns for that and other products……El Pollo Loco has selected Vitro, San Francisco, as its creative agency of record following a competitive review. Vitro will oversee all research, strategy, production, and integrated communications across television, radio, digital, and out-of-home for the 445-unit grilled chicken restaurant chain……Ad Age reports that Diesel has named Anomaly, Amsterdam, as global agency of record for the apparel brand. The upcoming campaign in February will be fully integrated and include TV, print and digital platforms.