Cable Networks’ Upfront Scorecard Nets Set Game Plans for Upfronts

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While it might be construed as antiquated, both from ergonomic and economic perspectives, the upfront selling season is nonetheless in the offing.

As many deride its practices — millions of dollars moving over cold pizza in the morning’s wee hours — the annual ritual, during which advertisers secure commercial schedules for the upcoming television season, is about to begin again.

And don’t think cable ad-sales executives aren’t excited about the prospects, perhaps with good reason. Many media buyers feel they were bilked during last year’s rapid-fire broadcast upfront, especially as fall show fell well short of audience guarantees. Meanwhile, cable’s climb past broadcast in the ratings continues apace.

Those and other factors (see preceding story) have cable executives thinking big about grabbing their fair share of the $1 billion in deals that could trickle the industry’s way from the older medium, and build upon last year’s industry average CPM gains of around 7%.

“Unquestionably, the early signs indicate that more dollars are headed cable’s way,” said Steve Gigliotta, executive vice president of advertising sales, Scripps Networks. “Where and how much are the intriguing questions.”

Cable also has a growing base of hit shows that have caught the eyes of more on Madison Avenue. Fox Cable Networks Group executive vice president of advertising Bruce Lefkowitz — who sells FX’s gritty cop drama The Shield, plastic-surgeon show Nip/Tuck and Denis Leary’s new firefighter show, Rescue Me— noted that of late, things have evolved greatly at the network.

“This is my third year,” he said. “The first year we weren’t in the room. Last year, we were seated at the table. This year, we expect to eat well.”

So do others. Offering targeted, attractive demos, E! Entertainment Television and others are leveraging their best performers to build stronger packages that bring in more bucks. “If buyers want some of our Red Carpet coverage, they have to push more dollars to us elsewhere,” said E! senior executive vice president of sales and distribution Dave Cassaro.

What follows are scorecards following how seven ad-sales executives — representing services that proffer sports, weather, lifestyle-enthusiast information, edgy general-entertainment programming, shows celebrating entertainment and celebrity, expanded gaming platforms and family-friendly fare — rated their networks’ performances in last year’s upfront, and how they’re positioned for the weeks ahead.

LYN ANDREWS

President of TWC Media Solutions, The Weather Channel Cos.

LAST YEAR’S MODEL:

Andrews said last year’s “excellent” upfront yielded 20% increases in volume over the prior year, and CPM advances that were “spot on” with the industry average. The gains emanated from higher spending among the do-it-yourself, packaged goods and pharmaceutical categories. Perhaps more importantly, TWC broke new clients in the brokerage, airline, computer hardware and fuel spaces. Entertainment/movies also came into play. “If it’s crummy outside, people are more likely to stay in and rent a DVD than go to the theater,” Andrews said.

2004-05 PLAN:

With better coordination now between the network and Web sales teams, both of which have reported into her office since December 2003, Andrews anticipates that “upfront volume gains will be at least the same if not better” this time around. “From a CPM perspective, we’re looking to bridge the gap between the price and value of the network,” she said, noting that packages will become even more important. Last year, Home Depot, Scott, Mosquito Magnet and Lowe’s all inked ad deals crossing both platforms, which either were initiated or concluded during the upfront.

HOT STUFF:

Storm Stories has proven to be a ratings winner over the past 15 months. Weather’s 5 to 7 a.m. and 7 to 9 a.m. morning dayparts have registered strong Nielsen growth, owing to greater emphasis on business- and commuter-travel info. TWC sales staffers will also talk up more “robust copy splits by states, time zones, DMAs, markets and weather types,” all enabled by the enhanced technology under the latest iteration of TWC’s Intellistar software.

DAVE CASSARO

Senior Executive Vice President of Sales and Distribution, E! Entertainment Television

LAST YEAR’S MODEL:

Upfront revenue was ahead 20%, with E!’s CPMs surpassing the market pace. “We were well into the double-digits,” said Cassaro, noting that E! routinely ranks in the top five among all networks, relative to incomes $100K, $75K-plus, homeowners, professionals/managers and prospective car buyers, among other key groupings. Sister spin-off service Style also performs well against these criteria. Cassaro and crew devoted more time and resources against the network last year, concomitant with its larger size. “A lot more clients want to talk you when you hit the 40 million-subscriber plateau,” he said.

2004-05 PLAN:

E! will stick to its knitting, pushing its wide array of original programming (more than 1,000 hours) saluting the worlds of entertainment and celebrity, and what Cassaro calls the right programming environment.

“It makes sense for L’Oreal or Revlon to have their products follow content about Nicole Kidman,” he explained. Style figures to evolve into more of a force, with rollout commitments pushing the network toward 50 million homes and Nielsen ratings in the offing. It skews a little more toward women than its older sibling — 60%, depending on daypart.

HOT STUFF:

E! news programming; the network’s growing Live from the Red Carpet preview and review coverage from the Academy Awards (“our Super Bowl”), Emmys, Golden Globes et. al.; and the True Hollywood Story top the net’s hottest real estate list, according to Cassaro. For style, judicial makeover show Style Court and the utilitarian kitsch of Brini Maxwell are attracting attention

MICHAEL SAKIN

Senior Vice President of Ad Sales, GSN

LAST YEAR’S MODEL:

Upfront volume spiked 50% last year, while CPM gains were in the low to mid-single digits. Business jumped on opening deals in the fast food, travel and pharmaceutical arenas. Sakin said part of last year’s presentation focused on setting up the premise of GSN and the broadening from the service’s traditional game show approach. Laying the groundwork a year ago presumably pays bigger dividends this go-around, especially on the CPM side, given the investment in new shows

2004-05 PLAN:

Now proffering 90 hours of interactive, play-along programming per week, GSN is again pitching an engaged viewing message. Sakin said the latest Nielsen data showed that viewer tune-in length totaled 25.6 minutes in the first quarter, up more than one minute from the prior year. That continues a skein that has stretched to nine straight top-10 quarters in this measure. “We’re speaking about involved, loyal viewers, who are TiVo [digital video recorder]-proof,” he said. Average age of interactive players: 24. Sponsorship of interactive enhancements, product integration as new shows like horse racing series American Derby are produced, and customized vignettes are all available, according to Sakin.

HOT STUFF:

GSN is pitching a mix of original and acquired fare that Sakin believes makes the network versatile in clients’ eyes. Targeting adults 18 to 49 overall in primetime (and 25 to 54 during the day, with more vintage game shows), GSN can skew more male with its World Series of Blackjack programming, American Derby, Kenny vs. Spenny and Extreme Dodgeball. Conversely, GSN can tilt to the distaff side with originals Fake-a-Date, and syndicated additions Dog Eat Dog and Average Joe.

ED ERHARDT

President, ESPN/ABC Sports Customer Marketing and Sales

LAST YEAR’S MODEL:

While ESPN participates in as many as seven different upfronts for its various holdings, there is one constant to its game plan: leveraging the brand’s various properties. Erhardt said an “aggressive approach to providing marketing solutions incented clients” to undisclosed gains in share and CPM growth last year. He reported solid advances with the wireless, pharmaceutical and retail categories.

2004-05 PLAN:

“Where The Boys Are” is ESPN’s rallying cry. “Young men are hard to find; a challenging market segment to reach. They’re fickle and multimedia-oriented. For us, though, it’s not only where the boys are, but that many of them are flocking to our brand,” said Erhardt. “We’re brand-centric, not platform centric.” He believes ESPN is well-positioned with categories that are poised for spending jumps. “The personal-grooming category for men is exploding. Foreign autos are really stepping up, particularly with trucks. Toyota, Nissan and Kia are all making brand investments there. The fast-food, the QSRs (quick-service restaurants) are back. McDonald’s is going after young males again. It’s no coincidence that McDonald’s has shown improved results as it has increased its TV advertising.”

HOT STUFF:

The NFL (ESPN’s Sunday Night Football and Monday Night Football on ABC) and a ton of pro football shoulder programming; NBA regular- and postseason action and ancillary pro-hoops fare; nine consecutive quarters of ratings growth for ESPN; ESPN The Magazine’s rate base climbing to 1.7 million; ESPN.com’s best-ever week, with 18 million unique visitors in March; the omnipresent SportsCenter.

BILL ABBOTT

Executive Vice President of Advertising Sales, Hallmark Channel

LAST YEAR’S MODEL:

Abbott said Hallmark lifted its upfront take by 100% from the prior-year period, via the combination of “breaking new categories and clients,” as well as buttressing budgets with automotive, retail and credit-card advertisers. “We were happy with our CPMs, based on the bigger packages we drove.”

2004-05 PLAN:

Abbott estimates Hallmark will expand its upfront volume by 75%: “Given the investments made in programming, marketing and distribution, the network deserves those [revenue] gains.” Abbott also wants to lift benchmarks from deals that were struck three or four years ago and “undervalue Hallmark’s current position. Our CPMs are significantly below our current standard. The value proposition is enormous now.”

To that end, he’s encouraged by interest in presenting sponsorships available for films, both original and acquired (Claritin and Kraft have already cinched such pacts), that vastly reduce clutter. “There have been many conversations with agencies and clients in which they’ve discussed putting money aside for these kinds of deals as part of bigger packages,” he said. “They have been receptive to attaching their brands to Hallmark’s.”

HOT STUFF:

The network has become a top-10 fixture in total-day (14 weeks running through mid-April). Hallmark is pitching quality movies and workhorse acquired series Mash and JAG. Hallmark, both on TV and in card stores can meet consumer needs around Christmas, Mother’s Day, Father’s Day and Valentine’s Day. “People think Hallmark around holidays,” said Abbott, who believes many viewers will be thinking of original telepic Boyfriend for Christmas come December.

STEVE GIGLIOTTI

Executive Vice President of Advertising Sales, Scripps Networks

LAST YEAR’S MODEL:

With a 50% rise in volume and CPM advances grading out in the mid to high teens, Home & Garden Television scored some of the industry’s highest marks. Gigliotti said that HGTV sold out its full allotment of inventory it allotted to the upfront — somewhere between 60% and 70% of its overall commercial load.

2004-05 PLAN:

Considering the strength of the scatter market and indicators from agencies and clients (presentations would continue into early May), Gigliotti foresees another strong performance from HGTV.

“The good news is that we’ve had a lot more conversations; a lot more clients are interested. We’re not going to have any trouble selling out our inventory. But we have to be careful not to move too soon before the market coordinates itself,” he said.

HGTV’s efforts are being aided by third-party research from Simmons that validates Scripps Networks’ position over the past five years: Viewers are highly engaged by the entertainment and information presented on the shows, and interested in the products that are used by the hosts.

HOT STUFF:

In Gigliotti’s terms, HGTV is selling a lineup like the NFL champion New England Patriots: there are no headline stars, just many strong players. “We have 21 primetime shows that average a 0.9, while 13 generate a 1.0 or better,” he said, before listing Design on a Dime and Curb Appeal, when pressed to name a couple of series that figure to stand out among client requests. All told, the network has re-established primetime viewing records four times this year through mid-April.

BRUCE LEFKOWITZ

Executive Vice President of Advertising, Fox Cable Networks Group

LAST YEAR’S MODEL:

Driven by The Shield and Nip/Tuck, FX was able to drive a 40% gain in volume, and CPM gains of 7%. For National Geographic Channel, which saw its distribution base grow to 40 million, upfront volume expanded 93%, while CPM also improved by the industry standard.

Lefkowitz said, though, said give the amount of new and “remixed” business the networks wrote last year, CPMs for both services actually tracked in the mid-double-digit range.

2004-05 PLAN:

Although Lefkowitz wouldn’t put precise numbers on it, volume expectations are in line with last year for both networks.

“A&E and Discovery have gone broader, vacating Nat Geo’s exploration experiential genre,” said Lefkowitz of the net, now in 47 million homes. As for FX, he’s confident it will add new clients and build with incumbents.

“On the flip side, some of our key competitors have maxed out. We stand to gain that way, too,” he said.

HOT STUFF:

FX is adding Leary’s Rescue Me to the other two original skeins, as well as acquired fare That ’70s Show, King of the Hill and Fear Factor. “We’re building a network show by show,” said Lefkowitz, noting that FX continues to bolster its appeal among the 18-to-34 set.

On Nat Geo, shows featuring an omniscient narrator droning on about the stalking lion are being phased out, replaced by programming that starts with results and then works the stories back.

Primetime ratings jumped to 0.3 in the first quarter, while the median age viewer is 47.

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