Optimistic Predictions For Syndie Upfront

Ad spending in the syndication upfront later this month will likely be up by low- to mid-single-digit percentages over last year, according to media buyers and analysts.

Buyers say spending will be up about 3%, but David Joyce, an analyst at Miller Tabak, expects dollar volume to be up 7.5%, from just under $2.7 billion last year to nearly $2.9 billion this year.

“Advertisers are going to shift some money to the Internet but there’s still a lot of demand for TV’s broad reach,” says Joyce.

Whatever the total take, it will not be evenly distributed.

The most popular daytime talk shows are expected to see cost-per-thousands increase as much as 10%. Low- and mid-tier shows will post modest CPM increases or will be flat to last year, according to analysts and media buyers.

“There isn’t one market,” says Howard Levy, EVP of ad sales at Disney-ABC Domestic Television. “If you have a show that’s not doing well, you’re going to have a tough upfront. If you have a show like Big Bang Theory, Live! with Kelly, Katie or Ellen, you’re going to have a good upfront because people want to buy those shows.”

The anticipated increase in syndication dollars testifies to the good health of the medium.

Shows like CBS Television’s Dr. Phil, Sony Pictures Television’s Dr. Oz and Warner Bros.’ Ellen and Two and a Half Men are all posting year-over-year ratings increases. And Warner Bros.’ Bang ranks No. 1 among all off-network shows in its first year in syndication.

“We anticipated enormous success for The Big Bang Theory, but it’s off the charts,” says Michael Teicher, executive vice president of media sales at Warner Bros. Domestic Television Distribution. “When you combine that with Two and a Half Men, which is a stellar performer, and an in-demand show like Ellen, we’re on par with the reach of the broadcast networks.”

The improving economy isn’t hurting, either. A few of the largest ad categories, notably automotive, are doing well. Auto sales this year through April were up 10.3% over last year, according to automotive research firm Morgan & Co.

“During the troubled economy, consumers held onto their cars longer than they normally would have. Now, they are in the market,” Teicher says.

He notes that other big ad categories like fast-food restaurants and packaged goods are also showing signs of improvement.

Another good sign for syndication is that the scatter market also has been improving, although slowly.

Typically, in the upfront, syndicators sell off a large percentage of the coming season’s inventory, around 50% or more. Whatever’s left over will be sold in scatter throughout the season when syndicators hope that demand will push up prices.

In the first quarter, scatter was weak. “We were writing business … with prices that were competitive to upfront pricing,” says Tricia Wolfer, associate director of broadcast at Empower MediaMarketing. “We’re in a position to be pretty aggressive for our clients.”

But second quarter scatter has been a bit stronger, say buyers and sellers.

This year’s upfront will also be fueled by five new talk shows.

“Talk shows will be the driver,” says Miller Tabak’s Joyce. “The networks’ soap operas are going away, so syndication is trying new talk shows.”

The fall’s new shows, led by Disney-ABC’s high-profile Katie with Katie Couric, are expected to quickly sell all the ad inventory that the syndicators make available.

Media buyers say they expect Katie to be a polished, well-made show with virtually no controversial content that would scare off advertisers. Moreover, viewers know and like Katie Couric. So, they’ll likely check out the show and stick with it if it’s good.

Other new talk shows in the upfront game this year: Twentieth Television’s Ricki with Ricki Lake, CBS’s Jeff Probst and NBC Universal’s Steve Harvey and Trisha with Trisha Goddard. The only new broadcast sitcom going into syndication is Sony’s Rules of Engagement.

“Advertisers have been very enthusiastic about The Jeff Probst Show,” says John Nogawski, president of CBS Television Distribution. “Advertisers always flock to quality shows.”

The syndication upfront is expected to kick off shortly after the TV networks’ upfront presentations to media buyers next week in New York City, or possibly right after Memorial Day weekend at the end of the month.

Top-tier shows will likely sell out within a couple of weeks. Already, media buyers and the syndicators are finishing up more complex integration deals where brands are placed into a show itself, as opposed to in a commercial break.

“Right now, we are aggressively looking for unique branded integrations that seamlessly put an advertiser in our shows,” says Nogawski. “We’ve had a great amount of interest from our clients in doing integrations in Jeff Probst.”

Buyers and sellers have been hammering out these deals for months. Now, the focus is shifting to the upfront and the ad inventories.

“It’s usually network first, followed by syndication and cable,” Wolfer says. “But I wouldn’t be surprised if they all move together this year, with network setting the pace.”

Joyce is projecting that the network primetime upfront will be up 7.1%, to $10.6 billion — that includes ABC, CBS, Fox, MNT, NBC and The CW. He’s forecasting cable TV will be up 8.1%, to just under $10 billion.

Another analyst, Anthony DiClemente from Barclays Capital, is projecting an increase of 4.3% for the Big Four networks, to $9.49 billion on CPMs up an average 8.7%. He’s projecting a 6.3% increase for cable TV, to $9.88 billion.