'No carnage' in Q4 TV ads
$2 bil in buys is shock to biz expecting slowdownDespite a troubled economy that is spawning rising retail prices, growing unemployment and record home foreclosures, most advertisers will not abandon national television in the fourth quarter, with just about every marketer planning to spend as much or even more than they committed in the May upfront.
Overall, national advertisers are expected to finalize fourth-quarter primetime upfront advertising "holds" to "orders" of more than $2 billion, with only about 2% canceled of the total put on hold during the upfront. The cancellation rate has been about 3% in recent and more economically rosy years.
This has confounded media agencies and surprised network sales executives, who were bracing for a grim year-end.
One major media agency executive said his clients would cumulatively cut 2% of their fourth-quarter upfront orders this year, but eliminating one major client who was cutting back more drastically, that cumulative percentage falls to just 0.6%. "I was expecting about a 4% cancellation rate, so this is surprising to me," the buyer said.
Rino Scanzoni, chief investment officer for media agency firm GroupM — whose clients spend about 30% of the total upfront national TV and cable primetime ad dollars — summed it up this way, "There will be no carnage of fourth-quarter ad dollars in television."
Advertisers are increasing their national TV spending across a number of categories: movies, retail, wireless, some pharmaceuticals and even packaged goods. And the troubled domestic auto companies are not cutting back as much as observers expected.
John Consoli is a senior editor at Mediaweek.