Slow, Low Single-Digit Start To Syndie Upfront

The syndicated TV upfront selling is underway — it began late last week — but it’s hardly the exciting, fast paced ad market of years past.

Media buyers have registered their clients’ budgets with syndicators who, in turn, are returning proposals to buyers, with little in the way of back-and-forth haggling or bickering.

“We cut a few deals, but the best way to describe it is sluggish,” says Jason Kanefsky, EVP of strategic investments at Havas Media North America.

Some ad agencies say they haven’t finalized any syndicated TV deals.

As of yesterday afternoon, “nothing has moved for us yet,” says Tricia Wolfer, associate director of broadcast at Empower MediaMarketing. “We are sitting back and hanging tight.”

Dollar volume is widely expected to be slightly down from last year with cost-per-thousands (CPMs) up 5% or less year over year.

“CPMs for high-end shows will be up by low single digits,” says Kanefsky. “I don’t think anything is cracking 5%, except maybe one or two shows. But, generally, I think CPMs will be up 1% to 3% or maybe 1% to 4%.”

What’s to blame for the soft upfront? One answer is the same one that contributed to the sluggish scatter marketplace of the last two quarters: a lack of hot shows.

“Syndication doesn’t have that much great stuff to sell,” Kanefsky says. “There isn’t a hot show. Katie Couric is finishing its [run] in year two. It didn’t have any juice behind it. There are a couple of good sitcoms. There are shows that we’ll eventually buy. But there’s no chase. When there’s no chase, there’s no market.”

The major syndicators echo some of what the buyers are saying about the upfront. But they also are upbeat that ad demand will be strong for hit shows like Steve Harvey from NBCUniversal Domestic Television Distribution. Harvey will begin its third season in September.

NBCUniversal also has this fall’s highest-profile rookie talk show, the Meredith Vieira Show.

“We are selling Meredith Vieira with a lot of enthusiasm,” says Bo Argentino, SVP of advertising and media sales at NBCUniversal Domestic Television Distribution. “People really respond to her because they respect her. They can tell that she’s talented, sincere and she is a great listener.”

Other shows debuting this fall include Debmar-Mercury’s off-cable sitcom Anger Management and its game show Celebrity Name Game. Warner Bros. has talk show The Real while CBS Television Distribution is debuting court show Hot Bench.

Meantime, Warner Bros.’ long-running talk show Ellen is in high demand as is the syndicator’s top-rated off-network sitcom The Big Bang Theory.

There was significant demand for Ellen in first and second quarter scatter, according to media buyers. The show had its most-watched season ever and tied for its best season ever with a 1.7 among women 25-54, up 6% over last year. It ranked No. 3 among all talk shows.

Warner Bros.’ Big Bang Theory, while down 20% year to year, is by far the No. 1 off-network sitcom with a 3.2 adult 18-49 rating, 0.5 points ahead of its nearest competitor. That is Twentieth Television’s Modern Family, which is No. 2 among all sitcoms in its first year in broadcast syndication.

“Shows like Ellen, Big Bang Theory and Modern Family will go fast,” says another seller.

Syndication also has in-demand hour-long dramas that usually air on weekends.

“Many of our clients look at our programs as an alternative to primetime,” says Argentino. “Those agencies look to off-network sitcoms and hours like Law & Order: Criminal Intent and Law & Order: SVU. They compare well to network primetime [ratings], but they’re much more efficient.”

Typically, about 75% of the upcoming TV season’s commercial time is booked in the syndication upfront. In 2013, for the full year, advertisers spent $5.2 billion on syndicated TV, according to ad-tracking firm Kantar Media.

Media buyers and sellers say there are a few ad categories that are strong in this year’s syndication upfront, notably consumer packaged goods and pharmaceuticals.

“Pharmaceutical is always strong, especially on [CBS Television Distribution’s] Wheel of Fortune and Jeopardy,” Kanefsky says. “The wireless companies have a lot of money. But you don’t see much movie money.”

Ad salespeople say other strong categories include financial (a small but growing ad category), insurance and retail.

“The auto category is down, although we don’t heavily depend on that,” says an ad salesperson.

The syndication upfront, as it does most years, is moving alongside the network TV and cable upfronts.

“Once it goes, it’s a small market, so it can go quickly,” Kanefsky says. “It’s just a matter of agreeing on prices and getting deals done.”

Most years, the roughly $9 billion network TV upfront wraps up first and fast, often in just a few days.

However, this year, the network TV upfront is dragging. That’s due in part to some buyers and sellers switching the currency used in negotiations from C3 ratings — commercial ratings that include live viewing and three days of DVR playback, to C7 ratings that cover seven days.

Still, the network TV upfront is underway and should wrap up within a week or so.

The roughly $10 billion cable TV upfront moves in two streams: fast for top-rated networks like USA Network and TNT. But it drags on through the summer for lower-rated cable networks.

“The broadcast networks are in full swing,” says a syndication executive. “The large cable companies are having conversations. And the upfront is moving for some syndicators, but not everyone.”

If the syndication upfront remains sluggish, syndicators say they’ll hold back some inventory, betting that the scatter marketplace will be stronger.

“I don’t know of anyone who is panicked about that,” says this executive. “It may just turn out that we have a robust scatter market.”