Young television viewers defied the current trend of declining viewership by actually growing in numbers in the fourth quarter of 2003. Kids TV advertising in 2004 could move upstream as well.
In a world where virtually all TV demographics have been slipping, kids TV ratings climbed a sizable 6 percent in total gross rating points from September 2003 through January 2004 vs. the same period the previous year, according to Publicis Groupe’s Starcom Media Group, a media buying agency.
“When you look at everything going down-for example, all the young men disappearing and cable’s big networks starting to level off-you get this unusual kids story,” said Sam Ormando, VP and media director of national broadcast research for Starcom Media Group.
The Disney Channel-which has seen kids 2 to 11 ratings rise to a 2.1 from a 1.6 the year before-accounted for much of the overall gain. Mr. Ormando said shows such as “Lizzie McGuire” and the Disney movies are attracting viewers.
For advertisers, the picture is somewhat muddy because The Disney Channel doesn’t carry advertising. But factoring out that cable network, kids ratings overall are flat vs. a year ago-still remarkable, considering the drop in TV viewing in many demographics, said Mr. Ormando.
The Cartoon Network also rose-to a 1.8 rating from a 1.6 the period before-due to improved programming, including “Teen Titans.” Fox Box is also up slightly, stemming from its programming that mostly skews to the young boy demographic. Saturday morning leader Kids’ WB dropped a major 24 percent to a 1.9 rating/10 share, due to declining shows “Yu-Gi-Oh!” and “Pokemon.”
The real mystery to kids program executives is there hasn’t been one big new kids program, unlike in other kids TV rating periods.
“There is no big hit like “Yu-Gi-Oh!” or a “Pokemon” that drew kids to the sets that weren’t there before,” said Allen Banks, executive VP and media director of North America for Zenith Media Services, a media buying company.
Mr. Banks guesses the weather has something to do with it. “It was really cold in the East and the Midwest,” he said. “Weather does have a tremendous effect on viewing patterns, and on kids as well.”
A stable supply of ratings points is a good news/bad news situation for advertisers. The good news is that advertisers continue to have program-buying options. The bad news is that a predicted rise in advertising spending will mean higher prices for kids advertisers. This comes after years of stagnating kids TV advertising dollars, which haven’t moved much from the annual kids TV advertising revenue pool of $750 million, according to media buying executives.
Advertising demand is increasing, especially in kids TV’s biggest category: packaged goods, which have replaced toys as the No. 1 spender. Procter & Gamble, Kellogg’s, Pillsbury and a number of other companies continue to increase spending.
Entertainment advertising is the fastest-growing advertising category for kids TV, especially with the explosion of DVD advertising spending. Other kids entertainment products-including theatrical movies-have increased ad spending as well.
All this activity has allowed the networks to sharply push up program pricing. During the fourth-quarter 2003 scatter market period, kids programmers posted on average 8 percent to 10 percent price increases.
“They are starting to raise rates, certainly during the peak periods,” said Shelly Hirsch, CEO of Summit Media Group, a New York-based media buyer for a number of toy companies. “For the last four years the networks have gone backward. At one point the rates were lower than the previous year. Now they are going forward a little bit.”
Kids television sellers expect the trend to continue.
Kim McQuilken, executive VP of sales and marketing for Cartoon Network, said one indication is the strong 2004 scatter sales. “During the third quarter and the fourth quarter of 2003 business started slow but finished very strong,” he said. “Scatter is now robust earlier, which is a signal the market continues to get stronger.”
FoxBox, a relatively new network programmed by 4Kids Entertainment, has been making strong gains with entertainment advertisers because it targets young boy viewers. Dan Barnathan, executive VP of advertising sales for FoxBox, expects even better news this year. FoxBox was second to the Kids’ WB during the fourth quarter in boys 2 to 11 ratings, with a Nielsen Media Research 1.6 rating/7 share.
One big question for advertisers over the past several years is not what to buy, but when.
In the past, major media buyers have said there is no reason to buy kids TV during the kids upfront ad sales period, typically in the spring for TV sellers. Kids ratings have been plentiful, and advertisers could do kids deals anytime, media buying executives said.
Not so, said Mr. McQuilken, whose group also sells the advertising time for the Kids’ WB. In New York recently, the two networks held a big one-day upfront presentation.
“There is a need for an upfront because of limited inventory, such as in the fourth quarter,” Mr. McQuilken said. “If you want to lock in a promotional window, you probably want to do an upfront deal.”
Specifically, media buyers and sellers view the eight weeks before Christmas, known as the “hard eight,” as the most crucial time. Mr. McQuilken said this period has grown by two weeks into what his sales group now calls the “hard 10.” Media buyers agree the fourth quarter is important, but there are other selling periods as well.
“There are probably seven or eight selling periods for kids-it’s the fourth quarter, it’s February, it’s pre-Easter, it’s summer, it’s back to school, it’s the hard eight, it’s late December,” said John Wagner, senior VP and media director for Starcom Media Group.