ABC-TV Introduces New Advertising Value Index. Plus Our Annual Upfront Economic Forecast. JackMyers Think Tank

As radically different as this year39s Upfront preseason may be and as permanently altered as the TV landscape is we can anticipate a surprisingly normal and traditional Upfront buying and selling season as industry professionals who have worked together for years settle into the realities of conducting their business At today39s scaledback ABCTV Upfront presentation the network will announce ten new comedies and nine dramas for the Fall season ABC Sales and Marketing president Mike Shaw will assure advertisers that commercials scheduled in specific genres of programming will air in like programs if the original series are cancelled or moved However advertiser and agency executives attending the presentation will not see pilots or clips as they have in the past nor will they be wined and dined following Instead The CW has taken over the tent outside Lincoln Center originally reserved for the traditional ABC party and will announce their programming plans moving from their original Tuesday morning presentation at Madison Square Garden Tomorrow CBSTV will unveil 13 pilots the only broadcast network other than Univision to deliver actual content at their Upfront presentation But CBS has also cancelled its legendary annual shrimpfest at Tavern on the Green Yesterday NBC hosted advertisers at 30 Rock for a quotwalkthroughquot Experience touting all the company39s assets followed by a traditional party at theRockCenter skating rink featuring more than 50 of the network39s leading stars FoxTV will present only program concepts at its Thursday Upfront followed by its traditional major industry party quotWe thought it was appropriate to thank the industry for its supportquot commented network sales chief Jon Nesvig at a recent industry eventBoth Turner Broadcasting and ESPN along with Univision have scheduled Upfront presentations this week with advertising executives more receptive to network alternatives and increasing focus on marketing extensions and crossplatform opportunities Last week MTV focused almost exclusively on brand integration models being introduced across all its networks and programs During the presentation Stephen Colbert munched on Doritos a major MTV sponsor to reinforce the support the network is receiving from talent and producers So ubiquitous this year is the focus on crossplatform extensions event marketing promotional tieins DVRbusting strategies causerelated initiatives and nontraditional opportunities that any network cable or broadcast not offering these capabilities will find itself fully commoditized and subjected to intensive cost negotiations quotIf you39re a content company that has seamlessly created content across platforms you have a distinct advantage in this marketplace Advertisers are buying brand connections with consumers not just eyeball deliveryquot commented Greg D39Alba chief revenue and operating officer for CNN Conversely agency executives who remain obligated to deliver optimum cost efficiencies to their clients find themselves immersed in yearlong ongoing creative and marketing conversations far outside their traditional scope of responsibility At today39s Upfront event ABC39s Shaw will announce a new research capability that will enable agencies to identify the core metrics they define as most relevant for each individual client from both syndicated and custom sources and to then analyze all primetime network programs and develop an quotadvertising value indexquot quotEach brand uses multiple marketing and media factors ranging from reach to engagementquot Shaw explained to JackMyers Media Business Report quotWe39re suggesting they can compare ABC programs to all other TV across their selfselected metricsquot Shaw identified 20 factors including C3 Nielsen ratings primary and secondary demographics psychographics percent original programming in a schedule pod length high definition household size and composition IAG engagement data and ABCD county composition The ABCTV model he suggested quotrepresents the evolution of optimizersquot by incorporating each advertiser39s most relevant media valuation standards on a weighted basis and enabling a programbyprogram and even commercialbycommercial evaluation across the TV landscape quotIt39s an opportunity for buyers to focus on their clients39 key marketing goalsquot commented Shaw Several years ago Turner Broadcasting introduced its Media at the Millennium research a spotbyspot advertising optimization model ABC will join almost every other broadcast and cable property by committing to close collaboration with agencies and marketers to develop creative ways to integrate brands into programming content and to deliver enhanced commercial engagement While the TV advertising landscape is clearly changing the focus this year is dramatically altered The changes to the Upfront presentations have not been precipitated solely as a result of the Writers Guild of America strike that sidelined program development during the critical preUpfront season The networks have taken this timeout to reassess their focus and priorities with agencies and marketers willing partners in the realignment Inevitably the next generation of Upfront buying and selling relationships will incorporate network review of advertisers39 creative strategies and an analysis of which advertising messages are most complementary to each network39s program content and which are most effective in holding audiences through commercial breaksJackMyers Upfront Economic ForecastIn past years JackMyers Media Business Report has issued specific projections for Upfront spending Both my forecasts and my postUpfront analyses have provided insights on market conditions and networkbynetwork revenue costperthousand and sellout performance My own performance has generally been onthemoney although last year I believed the market would be considerably softer than it in fact turned out to be At least this was according to published reports although annual corporate revenue reports were more in line with my original expectations This year I am not offering predictions nor will I report afterthefact on network Upfront revenues The Upfront is no longer a representative indicator of network performance and the information released by the networks is at best questionable If a network ever actually reports poor performance in the Upfront then we can be assured it was a disasterMost industry leaders appear convinced the Upfront will closely follow lastyear39s pattern without the delays caused by the conversion to C3 live plus 3day delayed commercial viewing ratings This suggests a reasonably quick process that should be completed ahead of the July 4 holiday The earlier Memorial Day weekend will also contribute to a speedier Upfront process While agency executives are less than eager to accept another round of CPM increases the fact is demand should be strong and networks are increasing value through multiple marketing and crossplatform initiatives While broadcast networks39 CPM increases will not fully compensate them for erosion suffered during and after the writers39 strike they should have healthy gains as well as incremental revenues from alternative distribution modelsBecause the higherdemand networks can reallocate their inventory reducing the share of lower paying categories and increasing the share of revenues from higher paying advertisers overall pernetwork CPMs can increase while individual advertisers and agencies can hold the line with minimal real CPM increases Automotive and pharmaceutical which are negatively impacted by current market conditions are traditionally lowerCPM advertisers and declines in overall category spending will be replaced by higher paying categories quotAdvertisers who are constantly looking for efficiencies are the ones who fall out of the medium for cost reasonsquot explained a senior industry executive quotThrough attrition networks are losing the lower cost advertisers and increasing sales to higher value advertisers The base of TV advertisers is still growing so the medium is healthyquotIt appears that once again the stronger networks will get stronger and the weaker networks will also do just fine But media companies that are slow to invest in valuebased media and marketing extensions will find themselves forced into a media commodity pool designed to drive costs toward free

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