One thing buyers will not go for is if the networks insist on double-digit price increases
If the Big Four broadcast networks don’t get "greedy," this year’s primetime upfront television negotiations for commercial time on next season’s shows could be completed in a couple of weeks instead of the couple of months it took last year, media buyers are telling TheWrap.
And what will it take to do get one of the major media buying agencies to complete that first major primetime advertising deal?
Buyers say a cumulative price for a primetime package that costs between 6-8 percent more than last year.
"Everyone agrees that the television marketplace is strong and advertisers have a lot of money to spend and they want to spend it this year in the upfront," said one media buyer, echoing the thoughts of many.
But one thing buyers will not go for is if the networks insist on double-digit price increases — which several of them hinted at in discussion with TheWrap this past week.
"I don’t think any media agency is ready to pay double-digit increases and give back what they gained last year in the upfront," the media buyer added.
Last year, buyers negotiated price decreases ranging between minus 2-7 percent.
Not all networks get the exact same pricing, but they are usually pretty close.
Last year NBC wrote business at the largest decreases, but they were the fourth ranked network in primetime. Fox won the season last year in the advertiser-desired 18-49 demo and got decreases around minus 2 percent. And ABC and CBS, along with the smaller CW Network, fell in between.
CW, because of its more limited inventory and its more targeted — young female — audience, is usually looked at differently by the buying community.
NBC does have a slight ace in the hole this year in that it has a group of cable networks under its parent NBC Universal umbrella, and pricing of ad packages on some of those stronger cable networks can always be adjusted downward a little to give NBC a break.
As for timing, "It’s possible that the first deal could get done before Memorial Day," one buyer told The Wrap. "But it all depends on price."
That’s a big change from last year, when budgets from the agencies weren’t registered with the networks until several weeks after the final presentations. This year that’s expected to start as early as this coming week.
"Last year agencies were being told they could sit on their budgets because whenever they decided to register them and start buying, there would be enough inventory to buy a price decreases," another buyer told TheWrap. "This year the smart media agencies should be telling their clients to have their budgets ready to submit now."
Regardless of when the market moves, there is expected to be around $1.5 billion spent on upfront primetime advertising this year over last year.
As reported last week, some of that will be because the networks will sell about 15 percent more inventory this at higher prices. And also because advertisers will want to spend more money in general to lock in prices and avoid paying the 25 percent increases they wound up paying for scatter advertising during this season.
Also last year, the media agencies were fairly strongly unified and it resulted in them getting decreases at every network. This year, it seems like it’s the networks that are banding together.
At least that’s what they’re telling The Wrap.
"Today we’re united like never before," CBS president Les Moonves said. "Today we’re all very bullish [about the primetime ad marketplace]."
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