Broadcast networks produced a 3.5% increase in the number of combined commercial minutes in prime time last year -- a sign that networks may be forced to squeeze in more spots to keep revenues growing. Nielsen figures show that the total rose to 5,688 minutes in 2008, topping the total of 5,492 the year before. While prime time saw a notable boost, daytime commercial minutes were about flat, with a total of 3,811 increasing less than 1% over 2007. Daytime covers 10 a.m. to 4:30 p.m. The figures span the range of English-language broadcast networks, including CW, MyNetworkTV and Ion. Cable is excluded. Only national-network spots are counted. Local breaks, promos and direct-response ads -- all of which contribute to the proverbial clutter -- are not. When prime-time and daytime commercial minutes are combined, the 2008 total increases 2.5%. That is close to the 3.5% increase in total revenues (to $17.23 billion) for the Big 4 networks in 2008, according to Universal McCann. But it is difficult to gauge a correlation because the financial figures also include dollars generated from afternoon weekend sports broadcasts and late-night. Spanish-language networks saw a much higher increase in commercial load than their general-market counterparts. Total commercial minutes for prime time rose 11% in 2008 from 2,540 to 2,817. Those figures cover Univision, Telemundo, TeleFutura and Azteca America. Trade groups, the 4As and the ANA, used to publish an annual "Commercial Monitoring Report," or clutter study, that offered some insight into increases in commercial loads and on-air promotions, but it was abandoned around 2001. While adding commercials can increase revenues, networks may be airing more to provide makegoods to advertisers as ratings decline.
The still-young IPTV distribution of video from telco companies has seen significant growth -- with more to come. Media researcher Parks Associates says there will be some 40 million subscribers worldwide who will get video signals from the telcos and their IPTV services. Parks Associates, which conducted the study, estimates that by year's-end, IPTV services will see at least a 50% hike versus 2008. Much of the rise comes from what Parks Associates says have been "aggressive" rollouts of services. That should continue if operators package in other digital services, such as convergence in entertainment and communications features, and interactive services, such as quality on-demand programming. Beyond multichannel lineups, telecom operators can accomplish several ends: differentiate, generate new revenue opportunities and pull subscribers away from competitors, says Kurt Scherf, vice president, principal analyst, Parks Associates, in a release. He cites service offerings that include "interactive services, unique search and discovery elements, home networking and enhancements to customer support." Parks Associates says 2008 worldwide IPTV subscriber levels were more than 20 million, an 80% climb versus the year before.
More grim news for the newspaper business this week as McClatchy Co. reported that total advertising revenue declined 30.2% in the second quarter of 2009 compared to the same period in 2008, from $406.4 million to $283.7 million. This powered an overall revenue decline of 25.4%, from $489.7 million to $365.3 million, in the same period. For the year-to-date, total revenues are down 25.3% to $731 million, due mostly to a 29.9% drop in ad revenues, which totaled $568.4 million in the first half. Despite the precipitous drop in total revenues, McClatchy managed to post a 43% increase in earnings from continuing operations in the second quarter, from about $17.3 million in 2008 to $25.2 million this year. This was attributed almost entirely to the stringent cost-control measures implemented by McClatchy over the last year. The continuing freefall in advertising revenues, however, suggests the long-term health of the company is still in peril. Like other big newspaper publishers, McClatchy has been hit by a one-two punch of Internet competition, combined with one of the steepest economic downturns in American history. Together, they have decimated all the major ad categories. Classified revenues, long the mainstay of the newspaper business, fell 41% at McClatchy in the second quarter, from $135 million to $80 million: a 62.5% drop in employment classifieds, 45.7% in real estate and 34.4% in automotive. Retail advertising fell 24% to $149 million, and national advertising tumbled 34% to $24 million. The collapse of employment classifieds also forced digital revenues down 2.9%; excluding employment classifieds, online revenues grew 24.7% in the second quarter. However, they still remain a relatively small part of the business. McClatchy CEO Gary Pruitt noted that the proportion of total ad revenues contributed by digital increased from 11.8% in the second quarter of 2008 to 16.5% in the second quarter of 2009. This was due entirely to the decline in overall revenues, not growth on the digital side. If total ad revenues had remained stable at their 2008 level, digital revenues' contribution would actually have decreased slightly, from 11.8% to 11.5%.
Determined to continue transitioning to a multiplatform media company, Meredith Corp. has purchased a one-fifth stake in The Hyperfactory, a widely recognized mobile marketing company. The move follows a series of strategic acquisitions by Meredith to expand its digital marketing capabilities over the last couple of years. Meredith's strategic stake in The Hyperfactory will put the mobile specialist's assets and expertise at the disposal of the magazine publisher's integrated-marketing division, which creates cross-channel campaigns for advertisers, bringing together with Meredith's print and online properties. Collaboration between Meredith and The Hyperfactory on behalf of advertisers will be made easier by the fact that the two companies already have major clients in common, including Coca-Cola, L'Oreal, Disney, and Kraft. Presumably, their familiarity with The Hyperfactory will make big ad clients more receptive to the idea of cross-channel campaigns, including a mobile component. Meredith began building its integrated marketing capabilities with the acquisition in April 2006 of O'Grady Meyers, specializing in customer relationship marketing and Web site development. In January 2007, it acquired Genex, an interactive marketing services firm specializing in online customer relationship marketing, and New Media Strategies, an interactive word-of-mouth marketing company. In October 2007, it acquired Directive, a database strategy and analytics specialist, and in June 2008, it acquired Big Communications, which specializes in health-care marketing.
Plans to hold the 4A's first combined media and leadership conferences in Austin, Texas -- outside a traditional Orlando-New Orleans-Las Vegas loop -- have been delayed. In April, 4A's CEO Nancy Hill announced that the two annual conferences would become a single event, with Austin as the locale in 2010. But the 4A's was not able to find workable dates -- March is routine -- or space options in Austin, and is now targeting the Texas capital for 2011. A decision on the setting for next year's combined conference is coming, perhaps around Labor Day. Like Austin, the site is not expected to be a tourist-heavy city. 4A's Chairman Tom Carroll was a driving force behind the Austin selection, partly to try and reduce any perception that either event was a boondoggle. Austin also is a mid-continent destination that could attract more West Coast-based attendees. Plus, it has a different vibe than, say, Orlando -- known as a high-tech hub, and dovetailing with an ad industry looking to stay a step ahead. Hill advocated for combining the media and leadership events, partly on grounds that a de facto re-bundling of media planning and creative tactics is taking place. Cost savings could also result. The media conference is a top moneymaker for the 4A's, attracting well over 1,000 attendees routinely, although that fell to perhaps 800 this year. The recession caused the leadership event's attendance to fall from 375 in 2008 to 300 this April in San Francisco. The leadership event, attended mostly by top agency executives, was known as the annual management conference, before a re-branding several years ago.
Disney Channel scored a big result from a special crossover episode of its big series "Wizards of Waverly Place," "The Suite Life on Deck," and "Hannah Montana" -- for the week ending July 19. With 9.29 million average viewers, the show "Wizards on Deck with Hannah Montana" on Friday, July 17, grabbed the highest results for a 2009 scripted cable show. Other older-skewing cable programming also continued to score well, including ESPN's special "Home Run Derby" -- part of Major League Baseball's All Star event, which came in second place to the Disney show with 8.25 million. ESPN's "Home Run Derby Prelude" came in seventh place at 6.06 million. The summer's other big-scripted shows targeting adults continued to draw crowds, improving over numbers of a week ago. "Burn Notice" from USA Network landed in third place for the week with 6.66 million viewers; TNT's "The Closer" had 6.59 million viewers; and USA's new summer drama "Royal Pains" had 6.23 million viewers. Good news for USA Network's longtime WWE programming: It picked up the pace with higher numbers versus the week before. WWE's "Raw" 10 p.m. show on Monday (8th place) had 5.52 million viewers, while WWE's 9 p.m. "Raw" show, also on Monday, had 4.93 million (13th place). Nickelodeon's nine "SpongeBob" editions occupied a big chunk of cable's top 20 list of programs, with its best result getting to 9th place with 5.37 viewers for its Sunday evening 9 p.m. program. Its worst result came with its Saturday morning 11 a.m. show, with 4.46 million viewers. RankProgramsNetDayTimeViewers (Live+SD) (000s) 1 WIZARDS ON DECK W/ HANNAH DSNY Fri 08:00P-09:30P 9,292 2 2009 HOME RUN DERBY ESPN Mon 08:18P-11:09P 8,250 3 BURN NOTICE USA Thu 09:00P-10:00P 6,664 4 THE CLOSER TNT Mon 09:00P-10:00P 6,590 5 ROYAL PAINS USA Thu 10:00P-11:00P 6,230 6 HANNAH MONTANA DSNY Fri 09:30P-09:55P 6,086 7 HOME RUN DERBY PRELUDE ESPN Mon 08:00P-08:18P 6,065 8 WWE ENTERTAINMENT USA Mon 10:00P-11:08P 5,523 9 SPONGEBOB NAN Sun 09:00P-09:30P 5,373 10 SPONGEBOB NICK Sun 08:30P-09:00P 5,169 11 SPONGEBOB NICK Sun 07:30P-08:00P 5,088 12 SPONGEBOB NICK Sun 08:00P-08:30P 4,952 13 WWE ENTERTAINMENT USA Mon 09:00P-10:00P 4,927 14 SPONGEBOB NICK Sun 07:00P-07:30P 4,851 15 SPONGEBOB NAN Sun 09:30P-10:00P 4,675 16 SPONGEBOB NICK Sat 10:30A-11:00A 4,674 17 SPONGEBOB NICK Sat 10:00A-10:30A 4,470 18 SPONGEBOB NICK Sat 11:00A-11:30A 4,460 19 NCIS USA Mon 08:00P-09:00P 4,290 20 HANNAH MONTANA DSNY Fri 07:30P-08:00P 4,219 Nielsen Ratings Data: ©2009 The Nielsen Company. All Rights Reserved
I know how difficult it is to mass market in America these days. But I have a Second Depression Era solution for you. It's easy. It's elegant. It's cost-effective. Just stop trying. Seriously, why spend a small fortune trying to talk to probably hundreds of millions of people when every one of them is or soon will be broke? It makes no sense to market to the middle class. There isn't a middle class anymore. There are only different degrees of rich people and various versions of poor people. Our credit cards are being revoked, even though we're never late with a payment. Some soul-sucking nonhuman at Chase decided we're not a good risk. We get 10% off groceries at Albertson's, but the prices were 20% too high to begin with. Dentists still need to finance their Mercedes, so even with insurance, Delta Dental will force us to pay $1,200 we don't have for a root canal, which still hurts, by the way. And we can defer our car payments for a couple months if we lose our job-but only if we buy a new car first, which we can't because, as you may have heard, we're fucking broke. What used to be the middle class is living in their SUVs. Behind the mall, parents fight to the death for Macaroni Grill leftovers in garbage cans, while their kids are mugging dentists in Mercedes for enough cash to score a $6 burger they saw that bikini-clad skank from "The Hills" eating in a Carl's Jr. spot. That is, until they had to sell the plasma TV so Mom and Dad could buy bus tickets to go downtown to the unemployment office. Of course, you have to identify us to ignore us, but that shouldn't be too difficult. Send us all one of those email surveys you're so fond of cluttering up our inboxes with and ask us, "Is your ass broke?" If we click "Yes," tell us, "Thank you for your time. Here's a $10 gift certificate to JustGoDie.com. Have a nice day." For those who toil in media planning, research and activation, the elimination of so many non-buying eyeballs will create enormous cost savings. I mean, really, how many rich-people communications channels can there be? No more need to spend huge amounts on network TV because nobody will have a TV anymore. (But NBC, ever the innovator, will buy truckloads of those little puke-colored basic computers given to starving kids in Africa, program them to run nothing but "Tonight Show" reruns on Hulu, and distribute them to starving suburbanites in America instead.) Online campaigns can be limited to stock sites and swankpets.com. Agencies can fire all those social-network gurus because who cares what some pauper says about your brand on Twitter? Every buyer will be a genius. Every suit will be a superstar. And all that yammering about accountability will disappear. A win-win for everyone except a couple hundred million former consumers nobody cares about anyway. Just don't go out on the streets after dark. We erstwhile members of the middle class are lurking in the shadows with nothing to lose and Wii wands sharpened to a killing point.