Scatter market upbeat so far

Pricing reported 5%-8% higher than at upfronts

If the 2009-10 TV upfront market was all about knowin' when to hold 'em and knowin' when to fold 'em, it won't be possible to assess how well the networks played their collective hand until next year.

About $2 billion got left on the table, leaving ad-sales bosses to go all in on what they hope will be a rock-solid scatter market. So far, the bet seems to be paying off.

Like hope for an economic recovery, the national TV ad marketplace is a fragile thing, but buyers and sellers are reporting an early surge in fourth-quarter spending. Scatter pricing in broadcast, so far, is 5%-8% higher than upfront rates, as clients who sat out the summer are anteing up again. Lured by a promising slate of new series (and a subsequent run of solid deliveries), marketers who suddenly found a few extra dollars moved quickly to pick up time on the fall schedule.

The chips are stacking up in the wake of the softest upfront market since 2001, when broadcasters swallowed CPM rollbacks between 2%-8% from the year before.

Some media buyers said they will wait a month or longer before jumping into the fray, stepping back to gauge the durability of the newly bullish market.

The lollygagging upfront threw off client presentations and more than a few internal clocks, causing the holds-to-orders cycle to bleed into the registering of Q4 scatter budgets. In some cases, clients who had cut costs in Q2 and Q3 began looking to add to their commitments when they went to order.

"The timing made it possible for some advertisers to try and scarf up some extra time, but at upfront pricing," one national TV buyer said. " Some networks may be in a position where they'll take whatever money gets thrown their way, even at the expense of getting the modest increases of scatter."

Said Harry Keeshan, executive vp national broadcast at PH.D.: "The compression gave rise to a mash-up marketplace. The result was a kind of hybrid upfront-scatter market that kicked in after Labor Day. Normally there are pretty clear lines when the upfront ends, when we go to order and then get into the scatter market."

Some shops still are presenting formal upfront buy recommendations to clients, said Christine Merrifield, senior vp at MediaVest. Regardless, the dollars keep rolling in.

"There's money in the marketplace," she said. "We're encouraged that the market is getting healthier as far as demand."

It's not clear how much additional money flowed from client coffers to upfront add-ons, but several buyers indicated that many clients added double-digit percentages to their commitments.

Overall, the add-ons might account for 2-3 percentage points of total network inventory.

According to a recent report by Credit Suisse senior analyst Spencer Wang, the networks sold 69% of available inventory in the upfront this year, or about 10 percentage points off plumb. The last-minute add-on activity probably boosted the broadcast network sell-out rate about 72%, buyers said, which is still well below the typical 75%-80% rate.

If broadcast is getting solid scatter increases, top-tier cable network sales chiefs said they're getting even higher rates.

"We're seeing healthy CPM gains," Turner ad-sales chief David Levy said. "We're looking at high-single to double-digit increases over what we booked in the upfront."

Broadcast and cable are enjoying a flurry of auto and retail activity.

"We are spending more this quarter than we did in last year's fourth quarter, but we also have fewer brands to focus on," a General Motors rep said.

Among the other big fish jacking up media spend through year's end are General Mills, Toyota and Target. In addition, credit card money is in play because of new cards and campaigns.

Anthony Crupi reported for Mediaweek; Steve McClellan reported for Adweek