In Depth

TV Ad Prices Falling, Media Buyer Says

Unit costs for primetime commercials on network television dropped 15% in the fourth quarter, a media buyer said.

The average spot cost $122,133, according to media agency TargetCast tcm. That finding was based on an analysis of data from SQAD Inc.’s NetCosts system, which gets pricing information from participating client invoices.

“The continuing decline in ratings—an overall drop of 13% across all the networks from a year ago—coupled with a declining broadcast economy is a recipe for lower prices,” said Gary Carr, senior VP and director of broadcast services at the agency. “The networks were forced to drop their prices to get what little scatter money was available from advertisers.”

The price of a spot on CBS fell 22%; spots on NBC dropped 13%; ABC ads were 10% lower; and Fox’s unit prices declined 6%, according to the analysis.

Carr said that while CBS had the smallest drop in ratings, its unit price fell the most because it had a lot of available inventory, Mr. Carr said. That inventory was available because the network didn’t have to provide many make-goods.

A CBS spokesman said, "We absolutely refute the numbers Targetcast is purporting to have."

(Editor: Baumann)
(Updated with CBS comment)