Statistics

When it comes to the 2008-09 upfront advertising selling season, cable is “better-positioned” than broadcast, according to Merrill Lynch analyst Jessica Reif Cohen.Reif Cohen, presenting both “bull-case” and “bear-case” scenarios, forecasts that cable’s take in the annual Madison Avenue bazaar, during which networks sell commercial time for the upcoming TV season, could fall somewhere between $7.45 billion and $8.06 billion.“We expect cable networks to materially outperform the broadcast nets, increasing commitments 5% in our bull-case scenario and falling 3% in our bear-case scenario,” Reif Cohen wrote in the report titled, What Happens If The Upfront Is Down A Lot.

Broadcast TV networks' upfront advertising sales will be down this year, posting a drop of between 2% and 14%, a leading Wall Street analyst said.

A "material decline is probable given ratings declines, the disruption in the development cycle due to the recent writers' strike and economic woes," Jessica Reif Cohen of Merrill Lynch said in a report published yesterday.

The May sweep should be the biggest month of the year, with season and series finales and maybe even a few network show finales (the only one in that category is “Scrubs,” which moves to ABC next year from NBC).But “Grey’s Anatomy” was down 9% from its first airing in the May sweeps; “Lost” was down 8%; and “American Idol” was off 5% versus the week before (which wasn’t in the May sweeps).Shouldn’t shows be climbing as the season ends? Even Fox’s “House,” returning this past Monday, got a warm welcome back from viewers — and 11% decline from its season average. CBS’s “CSI” is down as well.

As online advertising keeps growing, with more and more companies shifting some ad buys, TV executives continue to fidget. In the midst of this, DRTV has grown stronger than ever. According to TNS Media Intelligence, Q3 Short Form billings last year rose for the 11th straight quarter -- setting a third-quarter record at nearly 1.2 billion. Commercials in general may be facing some challenges, but the direct response model continues to thrive.

In the most recent Response magazine, our own Tim Hawthorne takes a look at Christmas-time advertising. Our team charted TV for hours and found that nearly 70 percent of all commercials included a web address. Fourteen percent featured 800-numbers. In fact, many DRTV staples now appear regularly in 15- and 30-second spots -- direct calls to action, purchase incentives, and even free samples. Indeed, someday all advertising will be DRTV.

The demographics of our nation are changing rapidly with a growing 50-plus market segment. This growing Baby Boomer demographic will represent approximately 14 percent of the population in 2008 -- that's 35 million people. Television, and DRTV specifically, has become a preferred medium to reach this 50-plus market in order to establish or reinforce a brand and to generate inquiries that result in sales for a variety of products.

Short form DRTV expenditures are continuing to increase over time as more corporate and political advertisers have entered the space. This has caused avails to tighten and rates to increase over the past year. In late 2007 and 2008 a number of marketplace factors will be at work, including a writer's strike currently underway, the fast approaching 2008 political season and the 2008 Summer Olympics all increasing demand for television time, making conditions challenging for direct response advertisers.

While we usher in all sorts of new forms of advertising, it's far too early to discard the old standbys. Home shopping channel QVC recorded record sales the first weekend this month, grossing $105 million from television, and another 25 million from QVC.com. Michael Dell himself helped move 31,000 computers, and DRTV stalwart Bose sold a lot of its music systems. Direct response television lives and thrives.

The Non-Profit Times is just what you'd guess -- a news publication that caters to non-profit organizations. In a story last month about the Nature Conservancy of Canada, the DRTV industry received major plaudits. Since beginning a direct response campaign in 2005, the Conservancy has averaged nearly 4,000 new donors each month--a very good rate given Canada's population. The article contends that DRTV "surpasses almost all other forms of fundraising in its immediacy of results."

There's a reason why so many of us adapt direct response tactics for our new media campaigns. Direct response video works -- as recently released data from TiVo makes clear. TiVo measured consumer reaction to various commercials, focusing in particular on ad-skipping. TiVo concluded that two types of ads kept viewers' fingers from pressing fast-forward: movie ads and direct response spots. No surprise with the movie clips --they're video entertainment just like TV shows. And also no surprise with the DRTV spots, which show good products that solve common problems. Who wouldn't like that?