The footie pajamas crowd keeps media buyers bullish
Networks gung ho on kids upfrontEarly reports on the ill health of the kids upfront have been greatly exaggerated, according to network ad sales executives, who hope to swap out Chicken Little projections of a flat to down market in favor of a more blustery Foghorn Leghorn outlook.
"You'd be crazy to think that the upfront will be flat," said Jim Perry, executive vp of 360 Brand Sales, Nickelodeon and MTVN Kids and Family Group. "Food has rebounded strongly, as have QSRs (quick-service restaurants). And movies are healthier than they have ever been."
Perry — who helped Nickelodeon kick off the upfront season March 13, when the kids powerhouse held its annual upfront presentation in New York — said he was puzzled by projections of a slowdown, pointing out that other than toys, "endemic categories are up in the kids space, and that alone would suggest that we're in for good, steady growth."
A key category that has struggled recently is toys, which is clearly a significant piece of the puzzle for networks targeting the footie pajamas crowd. According to NPD Group, U.S. retail toy sales slipped 2.2% in 2007 to $22.1 billion.
NPD pointed to worrisome declines among dolls (off 8% versus 2006), infant/preschool toys and sports toys (each down 5%). Action figures helped take some of the sting out, as sales in that category grew 8% in 2007.
If ad sales tied to toy promotions were flat or slightly down last year, Perry said nonendemic categories will continue to provide an ample lift in 2008. Like Disney Channel, Nickelodeon has aggressively gone after clients looking to reach parents who watch along with their kids. Since 2006, when Nick did some $50 million in nonendemic business, categories like insurance, automotive, travel, financial services, consumer electronics and wireless have become a sizable part of the network's business model.
"We expect to grow our nontraditional categories close to 50% in the 2008-09 upfront," Perry said. "We've been adding well over 25 new nonendemics each year. This is no longer just an ancillary or a minor part of the kids business."
The proliferation of nonendemic business and the longer gestation periods necessary to execute integrated and multiplatform deals have chipped away at some of the upfront's monolithic appeal. The upfront — and by extension the presentation that sets the table for that period — has become "less important in the kids marketplace," Perry said. "So many of our deals now are multiplatform and integrated, and they can take months and months to work out."
A 13-year winning streak on the ratings front and a roster of franchise hits like "SpongeBob SquarePants," "The Fairly OddParents" and the new live-action series "iCarly" — which drew 21.7 million viewers during the course of its Sept. 9-10 premiere weekend, averaging 3.92 million viewers per showing — have planted Nick squarely in the driver's seat in ad-supported cable.
"It's quickly becoming a one-horse race with the lead we have and the momentum we've sustained," Perry said. "But we're never going to rest on our laurels. All it takes is one hit and someone's back on their feet." In this case, that "someone" refers to second-place Cartoon Network.
When the Turner network unveils its upfront slate on April 3, the centerpiece of the presentation will focus on a new project from Star Wars creator George Lucas. Cartoon has ordered 22 episodes of "Star Wars: The Clone Wars," a CGI-animated series that takes place during the period between the events depicted in the "Star Wars" feature films "Attack of the Clones" and "Revenge of the Sith."
The series will premiere in late summer 2008, following the Aug. 15 opening of a feature of the same name.
Lucas has already created 30 half-hour episodes of "Clones," and more are in production. Turner has not made a commitment beyond its original order, however.
Beyond the "Star Wars" project, Cartoon has been quiet about its programming plans, reserving any further revelations for its New York upfront presentation. Beth Goss, executive vp ad sales, marketing and enterprises, said the network will renew its most recent hit, the whimsical "Chowder," which premiered in November to record ratings among kids 6-11 and boys 6-11.
This spring, Cartoon will push things forward with another series, introducing the spinoff "Ben 10: Alien Force." The network and toymaker Bandai American are anticipating a huge hit with the sequel; in fact, Bandai already introduced the series' line of action figures a month ago at the American International Toy Fair.
The most pressing concern facing Cartoon in 2008 is its protracted ratings slide. According to Nielsen Media Research, Cartoon fell 6% in total day viewers, averaging 1.1 million, good for fifth place among ad-supported cable nets. Nick was tops with 2.12 million viewers in total day, flat compared with a year ago. Cartoon also lost 9% of the kids 2-11 demo (607,000), taking second in total day to Nick's 1.2 million, while falling 10% with its delivery of kids 6-11.
"It takes awhile to turn a ship around," Goss said, adding that the executive team is only now beginning to gel. In addition to Goss, who joined Cartoon slightly more than a year ago, new hires include Brenda Freeman (chief marketing officer of Turner animation, young adults and kids media) and Stuart Snyder (executive vp and COO of animation).
Just a week ago, Cartoon moved its current-series team from Atlanta to Los Angeles, bringing together those programmers and the net's development team under the auspices of new vp original series Robert Swartz.
In addition to reversing the ratings shortfall, Cartoon will place particular emphasis on its rapidly expanding digital offerings. The network's Web site averages about 7 million unique visitors per month, according to comScore, and Goss said media buyers have become increasingly receptive to the opportunities afforded by CartoonNetwork.com.
"They're saying that their clients need to be in both the linear and digital environments if they're going to reach our demos," Goss said. "Kids are platform-agnostic, and if you want to make sure you're getting out in front of them, you have to plug into every extension, hit every touchpoint."
Of course, as TV remains the cornerstone of the business model, the actual shows remain paramount above all other factors. On March 13, Nick introduced a slate of three new original series, including the animated strip "The Mighty B!" which was brought to Nick by "Saturday Night Live's" Amy Poehler. Gamely pitching advertisers on the concept — in a doomed quest for personal perfection, a hypomanic 9-year-old girl tries to earn every possible Honeybee Scout merit badge — Poehler called her creation a story about "an aspirational superheroine who is kind of intense and gets advice from her index finger."
Nick has ordered 20 episodes of "The Mighty B!" which premieres 10:30 a.m. on Saturday, April 26.
"This is a dream come true," Poehler told the upfront crowd. "So, come on advertisers. Won't you share this delicious Dreamsicle with me?"
For Nick, the dreamiest part of its sales proposition is flavored green. According to TNS Media Intelligence, the network took in slightly more than $900 million in ad sales revenue last year, nearly tripling Cartoon's take (just over $290 million).
Media buyers contacted for this report declined to comment until they had a chance to see new programming slates from Nick and Cartoon.
Anthony Crupi is senior editor at Mediaweek.