The recent traditional start to the fourth quarter has some networks--The CW and NBC--feeling their oats, according to media sellers, saying that pacing and pricing is quicker and somewhat higher--even if it is just a bit so.
We have seen this before--a rumor of a strong scatter market. But for the past two years or more, scatter pricing has been weak, offering up just about the same upfront pricing. Thus there has been weakness in the upfront activity, in terms of velocity, volume, and intensity. Why buy any inventory five months to ten months beforehand, when you can get the same inventory--at roughly the same price--a few weeks before your commercials air?
Johnson & Johnson's move looks like a good one, according to media buyers. The company sat out the usual June broadcast upfront circus-like proceedings to start buying in August and September. But, amazingly, there is still no rush. J&J says it is still negotiating deals--and we are almost in October!
The ball isn't completely in J&J's court. Sources say it asked for some price and positioning safeguards back in June. The company didn't want to lose their "bases"--the base-price positions of a year ago. It also didn't want to lose valuable inventory. Sounds like an upfront plan to me.
If J&J's gambit proves successful, other upfront advertisers may decide to make the same move next year.
But the key is scatter pricing versus upfront. The longer this trend continues --scatter and upfront being priced the same-- the more TV sellers might need alternative plans, like pushing more of their digital properties into the upfront market.
ABC and CBS each have goals for around $150 million to $175 million in fourth quarter scatter revenue, according to media agency and selling executives. NBC is targeting somewhat lower at $130 million. Fox's number is lower than that (since they have less overall prime-time inventory than the other three networks).
All this is necessary to keep inventories supplies at certain levels, to maintain--hopefully--high price levels.
We all are watching--with either scattered or focused interest.