Kids Spending: Big and Getting Bigger

Feb 12, 2007  •  Post A Comment

By Debra Kaufman
Special to TelevisionWeek

Kids’ spending power was estimated in 2005 at $78.5 billion annually. Nobody is bandying about figures this year but executives heading for the kids upfront are in agreement with what direction it’s going. “Certainly, you’ve got to believe it’s increasing,” said David Levy, Turner Entertainment president of entertainment ad sales. “Kids are becoming more and more part of the purchasing process, even for cars and other non-traditional genres.”

That’s the kind of talk that gets everyone hyped up for the kids upfront. It promises to be active, with estimates that 60 percent to 80 percent of some networks’ advertising will be purchased during this time.

This year, as last, the upfront continues to be complicated by the multidimensional negotiations required in a multiplatform world. “One reason why the kids market is moving slower than it used to is because deals are getting more complicated as the networks add more touch points,” said Starcom USA VP and Director Jackie Kulesza.

At the same time, new media is steadily growing in importance for attendees at the kids upfront. “It’s an opportunity and a growth engine for us,” said Tricia Wilber, executive VP, Disney Media Advertising Sales and Marketing Group, who reported that the Disney.com site is No. 1 for kids 6 to 14. “Kids are certainly the first and some of the biggest users of this media. There is a lot of opportunity to really work with advertisers in terms of new media, to leverage the relationship we have with our users.”

The Walt Disney Co.’s ad sales department reorganized recently to better reach kids and families across TV, online, publishing and radio. “Kids are using TV, online, radio, print, sometimes simultaneously, sometimes independently, following the content to all these places to connect,” Ms. Wilber said. “Advertisers are very interested in leveraging the relationship to all these platforms. By putting all our divisions under one management structure, we’re able to create ideas that make it easier for an advertiser to work with us.”

Ms. Wilber hopes to create this kind of leverage with the company’s Disney Channel Games, in which the channel’s talent competes with each other individually and in teams. “We’re creating an opportunity for advertisers to use these events in a way that can be multiplatform and we can deliver on,” she said. Disney Channel Games began as interstitials last year, running under the banner “So Hot Summer.” When the audiences responded enthusiastically, the Disney Channel Games were expanded throughout the Disney Channel world, integrating music with concerts by its stars. Ms. Wilber said the company is working on a Radio Disney “ultimate mall tour” to bring it into local markets, and that several advertisers have expressed interest.

Though toys and food are advertising staples, nontraditional categories, including automobiles and life insurance, are hot this year. “A lot of parents are watching TV with their kids,” said Mr. Levy, who noted that cellphones are another nontraditional category that could heat up. “We’re looking to see if there are other opportunities as co-viewing grows.”

Mr. Levy also pinpointed more traditional arenas-movies, gaming and toys-as other growth categories this year. “A lot of movie companies are coming out with big projects, like `Spider-Man 3,”‘ he said. “There was a sort of slowdown in this genre in the ’06 upfront, but I see this category being a very big pickup at this one.”

Retail is a hot category, said Ms. Wilber, who added, “Wireless is certainly an opportunity. Wireless may not be growing in terms of total dollars, but we seem to see the money shifting to nontraditional categories.”

She also pointed out that food advertisers, a very traditional category, are in flux given the national conversation over childhood obesity. “We’re seeing changes in terms of how food advertisers are marketing to children and families,” she said.

Some executives point out that the demand periods for kids marketing have been growing. The “hard eight”-the weeks from mid-October into November-is creeping into earlier periods, becoming in effect a “hard 10.”

Fourth quarter is of crucial importance, but that doesn’t mean that networks or advertisers are giving up on the upfront. “We’re selling almost on a 52-week basis nowadays,” said Mr. Levy, who added that Cartoon Network is focusing on its core and dominant demographic, boys 6 to 11. “But we don’t move the marketplace, the marketplace moves itself.”

“The upfront is still very important,” said Ms. Wilber. “The fourth quarter has greater significance for the toy advertisers, and some other quarters may be less sold. But still, a significant amount is sold in the upfront, and we’ll definitely see the upfront being more important for us.” Another overarching theme for the kids upfront is the continuing controversy over Nielsen’s new data streams. Last year saw wrangling between networks and advertisers over the standard live, live-plus and the new live-plus-7, which measures DVR viewing for a week following the live airing. Nielsen has since switched to a six data stream system-live viewing as well as five DVR streams: live plus same-day, one-day, two-day, three-day and seven-day DVR viewing-which will be released in May, well before the upfront begins. “It’s a question as to whether or not they will guarantee those ratings as opposed to guaranteeing the show,” said Ms. Kulesza. “What currency do we use to do the deal?”

The kids upfront is changing dramatically in a multiplatform world with co-viewing and struggles over how to interpret data from DVR viewing. But it is most definitely not dwindling away.

. Think of the upfront as the planning process, and then when the marketplace moves, that’s the transactional part