Advertisers, Agencies: Cable Nets Likely To Benefit From Upfront Share Shift

Cable networks are likely to see an increase in upfront ad spending this year, while broadcast network budgets seems less likely to grow, according to results of a survey of 300 advertisers and agencies released Thursday by an industry analyst know to be a confidant of the the cable TV industry.

The Jack Myers Report Advertising Confidence Survey shows that more than 60 percent of clients and agency executives think their cable budgets will increase in the upfront. Sixty-two percent of client executives expect their cable budgets to increase for the upfront, with 36 percent thinking they will stay the same and only 2 percent predicting a decrease. Among media agencies, 66 percent say their cable budgets will increase, while 26 percent believe they won't change and 9 percent predict a decrease. The average increase is 4 percent to 5 percent, the Myers survey said.

Thirty-nine percent of advertisers say their upfront broadcast budgets will increase, compared to 45 percent who think they will stay the same and another 16 percent who say they'll decrease. Forty-five percent of agency executives surveyed say the broadcast budgets will rise, compared to 34 percent who don't expect a change and 22 percent who think their broadcast budgets will go down for the 2004-2005 upfront season.



Advertisers think their increases on the broadcast side will be between 2 percent and 6 percent. When they're talking declines, only 6 percent say there will be double-digit cuts in the broadcast upfront budgets; the rest peg declines at an average 2 percent to 3 percent.

The Myers Report said that national syndication's results--with 58 percent of advertisers and 61 percent of agencies thinking there will be no change in budgets this year--means that syndicators still need to justify their value. Thirty-nine percent of advertisers think their national syndication budgets will increase, and 32 percent of agency executives think so.

Myers hasn't issued his upfront forecast yet--that will happen next week--but he said that the survey points to CPM and dollar-volume increases for cable, syndication, and broadcast, in that order.

"They're not ready to punish the networks unless the networks insist on CPM increases they believe are unrealistic," Myers said. "Advertisers are willing to increase CPMs to compensate for ratings erosion, [a] reward for improved demographic delivery. But they are not willing to add to those increases added costs simply because of additional supply. The additional supply factor will simply go to cable."

The Internet-based survey of 300 was conducted in the first two weeks of April.

Next story loading loading..