Commentary

TV's Upfront Advertising Drug: Movie Marketing Dollars

"Hollywood spent more money marketing movies that were seen by fewer people," says Daily Variety.

If you have been a veteran TV media buyer--does this remind you of anything? It should have. TV buyers have been spending more on network TV shows for years, while getting fewer viewers.

So it seems there is a parallel universe going on in other forms of entertainment. Maybe the same could be said of radio, newspapers, or any other slightly older entertainment media. Everybody is scrambling to keep up, paying more and getting less--with no end in sight.

Theatrical film marketing costs rose 5.2 percent to $36.2 million per picture in 2005. That's music to the ears of network, cable, and syndication TV sellers, who depend heavily on this seemingly never-ending growing advertising category. Interestingly, that 5.2 percent was the average program price hike that all advertisers paid during last year's TV upfront.

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Looking closer should give TV sellers even more pleasant dreams. Movie spending in newspapers dropped significantly, from 19.7 percent in 2004 to just 15.5 percent of total film marketing expenditures in 2005, while television, online and other media showed gains.

Gross film marketing dollars don't have the same story. Overall film marketing dollars were the same last year versus 2004, say the studios. Fewer wide-release movies could be the reason. Another bad movie stat: U.S. ticket sales fell 6 percent and total attendance slipped 9 percent--the third straight year of losses.

What does this all mean for TV networks and other program sellers? That TV could be next in taking a hit? Hardly. Movie studios will no doubt continue to plunk down premiums in buying TV time--making films the most expensive TV advertising category. Studio media dollars will continue to be used as a springboard in starting TV's upfront ad business.

But the dynamics could be changing. The bigger question is whether enough big tent-pole theatrical features will still deliver massive TV ad revenues--especially during the final weeks of the TV season, when studios push big summer theatrical releases.

As witnessed at the recent Academy Awards, smaller and more modestly produced and marketed movies may be in vogue. Those costs have been rising as well. Studio boutique brands such as NBC Universal's Focus Films and Fox Filmed Entertainment's Fox Searchlight witnessed a 33 percent jump in the marketing money spent on an average movie, up to $15.2 million.

All this might change the TV advertising dynamic a bit, perhaps easing movies' TV ad prices as smaller films replace bigger pictures.

So TV sellers shouldn't get too comfortable that their movie studio older brothers will continue to pay TV's big upfront meal tickets. In a parallel universe, everything always seems familiar--but there's always something that is off, something lurking in the corner--usually an evil twin.

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