US TV Networks Ready 'Sold Out' Signs for Scatter Time

19 November 2001

Following a costly couple of months, America’s TV networks have sold nearly all their prime-time scatter ad inventory for the rest of the year - at rates around 3% to 5% higher than those charged during the upfront season in the summer [WAMN: 03-Jul-01].

Networks have filled almost 95% of their slots, with strong sales to advertisers in the automotive, telecoms, movie, pharmaceutical, soft drink, video game and fast food sectors. Moreover, beamed one anonymous ad sales executive: “Pricing has not collapsed as all the experts predicted it would.”

Early 2002 also looks promising, with advertisers exercising cancellation options for first-quarter slots at a far slower rate than last year, meaning networks will receive the bulk of the $1.7 billion committed to Q1 ads during the upfront. The lowest cancellation rate recorded is 4%, with no single client of the six major networks pulling more than 10% of its ads.

“Anything under 10% cancellations is considered a normal rate,” explained a network insider, “but last year most networks averaged between 15 and 20 percent, which was a disaster on top of the soft scatter market.”

However, Disney-owned ABC is not greatly benefiting from the rise in business. Around half of ABC’s current shows – including former ratings winner Who Wants to be a Millionaire – are attracting lower audience shares than guaranteed to advertisers during the upfront.

Consequently, much of the network’s scatter time is being filled with makegoods (ads given to clients to make up for deficient ratings), reducing the amount on sale. This has had the effect of tightening the market, to the benefit of ABC’s rivals.

News source: (US)