Cable Forecasts Bigger Share of US Upfront Ad Revenue

05 May 2004

Cable is predicting its share of the television advertising pie could increase by $1 billion (€0.8m; £0.5m) during the current upfront bazaar.

Executives such as Mark Rosenthall of MTV Networks hope their sector will benefit from continuing dissatisfaction with the big six networks. Rosenthal says they are "perceived as more expensive than ever before while delivering a whole lot less."

For their part the traditional networks' emphasis lies in their ability to deliver mass rather than fragmented audiences.

Overall, advertisers spent $9.3bn on the networks last year compared with $5.4bn on cable.

The car giants, however, are still smarting from last year's 15% rates hike by the networks. Hardly surprising that cable feels it could pick up a few more dollars.

Steven Wilhite, vice president of marketing at Nissan North America will spend less upfront this year and plans a broader media portfolio by using cable TV, outdoor, online and events.

Similarly Ford, which is upping its annual ad budget by 10% over the $793m it spent last year, plans to increase internet and direct mail in preparation for several launches in the fall.

General Motors says it won't be cutting back on spend this year, but will be using more non-traditional advertising.

Last year the carmakers demonstrated just how thin their patience was wearing. According to TNS Media Intelligence/CMR the industry cut its ad spending on the national broadcast networks by 44.4% to $1 billion. Simultaneously they increased cable spending by 12.5% to $377m.

Opinion is divided as to just how much money will actually shift. "You will see money move" toward cable, says Debbie Myers, vice president of media services for Yum Brands fast-food chain Taco Bell.

Eric Conn, assistant vice president of national advertising for Acura and Honda isn't so sure. "There are a lot of [other] cool media out there, but is anybody really reaching anybody with it?"

Data sourced from: multiple sources; additional content by WARC staff