Interconnects Say 2002 Was Fine - Multichannel

Interconnects Say 2002 Was Fine

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Executives at key interconnects are able to look back on 2002 ad-sales results with more enthusiasm than was possible a year ago. And last year's upward sales trend has made them more optimistic about the current quarter.

Although the final quarter of 2002 was skewed by the impact of the faltering econom0y and the effects of the Sept. 11, 2001 terrorist attacks, fourth-quarter numbers were strong nonetheless.

Adlink president Bob McCauley said the Los Angeles interconnect posted "tremendous growth — plus 31 percent" in the last quarter of 2002. That translated to growth of "$8 [million] or $9 million."

Rainbow Advertising Sales Corp. president David Kline said the New York Interconnect "grew over 20 percent [last year]; that's terrific." That overall performance was bolstered by a 23 percent to 24 percent final-quarter advance, he added.

Comcast Corp.'s total cable ad sales rose 15 percent in 2002, said cable unit senior vice president and managing director of sales Hank Oster, bolstered by a 21 percent upsurge in the fourth quarter.

Separating out the newly acquired AT&T Broadband, Oster added that Comcast operations posted a 10 percent uptick for last year.

"Interconnects are making the difference" for Comcast, Oster said, without breaking out the figures. "Our mandate is to interconnect [legacy Comcast and former AT&T] markets with consistent standards and practices across the board."

What's hot

Though separated geographically by many miles, various interconnects benefited in 2002 from increased spending in the automotive, fast-food and retail sectors.

"Advertisers were feeling more secure" than they had been in the aftermath of Sept. 11, McCauley said, noting that automotive, fast food and broadcast clients, as well as cable network tune-in spots, were segments that posted the biggest quarterly spending gains. Political advertisers also contributed $1 million to Adlink's coffers, compared with zero in 2001.

Describing the closing quarter as "a home run," he said Adlink finished that period "definitely over budget and [that] got us to [our] budget for the year."

In 2002, Adlink lifted its sales volume by 7 percent, McCauley noted. The interconnect's full-year performance was bolstered by the same categories, though the percentage increases were smaller.

Fast-food companies spent 33 percent more in 2002 than in the previous year, he said, while automotive allocations were ahead 15 percent and tune-in spots (or the media category) were up 9 percent. Retail notched an even heftier comeback — "plus 78 percent," McCauley noted.

Citing such attractive programming as TLC's Trading Spaces, Sci Fi Channel's Taken
and MTV: Music Television's The Osbournes, Adlink vice president of marketing and communications Matt Brown said "our promotional tie-ins have more leverage as well." Brown estimated that 30 percent of Adlink's revenue stemmed from promotional tie-ins.

Thanks to inroads with clients like McDonald's Corp., the Big Apple interconnect boosted ad sales from the fast-food sector "by nearly 300 percent," Kline estimated. Other categories notching hefty spending upticks last year, he said, were hardware and other retail stores (up 204 percent); broadcast and cable networks (up more than 100 percent); and banking and banking services (up 75 percent). Political campaigns also proved strong last fall for the interconnect and for its systems.

But travel and telecommunications clients are still lowering their budgets, though not as much as in 2001. Other ad executives echoed Kline's observations.

The '03 outlook

The current quarter so far "couldn't be better," said McCauley. "We're pacing in the plus-60s [in growth percentage]. There's tremendous growth."

"We're telling advertisers, 'The landscape has changed. Have you changed your media plan?' " McCauley said.

Through a new sports division, Adlink has also placed a greater emphasis on selling genre availabilities during over 1,600 live pro and colleges games each year. "Frankly, we haven't been marketing and selling that enough," said McCauley.

The New York Interconnect's current quarter is likewise off to a "very strong start, ahead of a year ago," Kline said, with "business booked heavily into March." That pacing owes to some degree to National Cable Communications' becoming its spot-sales rep as of Jan. 1, he said, noting that the rep firm already has brought in new business.

For its own part, RASCO's interconnect is trying to develop more promotions and relationships with existing clients. As far as joint promotions with the various cable networks, Kline said, "We're looking to expand on that, probably in the second half of the year."

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