Media Buyers Split On C7, Expect Low CPM Increases
Media buyers are split down the middle on whether the national TV market will shift its dominant currency from C3 to C7 over the next 12 to 18 months. A swap is “inevitable at some
point,” but may have little impact on market economics.
The 50% of buyers surveyed cast doubt on the switch, indicating that it would hurt advertisers with
“time-sensitive” messages, while the other half who suggested it would come noted it could offer a “more accurate portrayal” of viewing with time-shifting growing, according to
a Credit Suisse report.
The Wall Street firm suggested a switch would increase rating points in the market by about 3%, but buyers could tone down the impact by negotiating some price
relief.
More generally speaking about the coming upfront market, buyers suggested CPMs would increase in the low- to mid-single-digit range, while total volume would be flat or up
slightly.
Of course, it would be a shock if buyers came out saying the market would be exceedingly hot and demand off the charts. The public declarations about all things
upfront that take place each year were best summed up by CBS CEO Leslie Moonves in 2006: “It's a very interesting PR thing that goes on where the advertisers always say: 'Down CPMs' and we
always say, 'Oh no, way up.'" And the truth is somewhere in the middle.”
As for the current scatter market, buyers indicated in the research that pricing is up in the
mid-to-high single-digit range over last summer’s upfront.
Separately, Credit Suisse offered some projections on the 2014 TV ad market, calling for the national broadcast
segment with help from the Olympics to increase 3% over 2013. With political dollars, the local market should be up 13.7%. Cable is predicted to increase 4%.
Cutting out Olympic
dollars, national broadcast is forecast to decline 1%. Stripping out political revenues, local broadcast is projected to increase by the same amount.
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