TV Advertising... Is There This Much Value?

Syndicated from 'Sunday Night Football' Remains Costliest TV Show
By Brian Steinberg
Published: October 26, 2009

NEW YORK (AdAge.com) -- NBC's "Sunday Night Football" continues its reign as the most-expensive fall program for advertisers, with a 30-second ad commanding an average of $339,700, according to an Advertising Age survey of media buying firms. The NBC Sports broadcast has commanded the most expensive advertising time for two consecutive years, reflecting the value of live programming that reaches big audiences who are less likely to skip past commercials with a digital video recorder.

AP
NBC's 'Sunday Night Football' has commanded the most expensive advertising time for two consecutive years. That's not to say that scripted fare doesn't bring in big bucks. Of the 10 most-expensive shows on prime-time broadcast TV, the back nine are all scripted (though two are animated). A 30-second spot on ABC's "Grey's Anatomy" costs an average of $240,462, while a 30-second ad on ABC's "Desperate Housewives" costs an average of $228,851.

Ad Age calculated ad prices for each show by using the upfront prices agreed to by as many as seven different media-buying agencies and other sources. According to our survey, TV prices seem to be on the decline. In the 2008-2009 season, NBC's "Sunday Night Football" commanded an average of $434,792 for a 30-second commercial, compared with this season's average of $339,700. ABC's "Grey's" brought in an average of $326,685, compared with this season's $240,462.

The other programs commanding top ad prices are CBS's "Two and a Half Men," in which a 30-second ad costs an average of $226,635 (vs. last year's $276,433); Fox's animated "Family Guy," in which a 30-second ad costs an average of $214,750 (vs. 2008's $231,306); Fox's animated "The Simpsons," which commands an average of $201,920 (vs. last year's $250,000); CBS's "CSI," which got an average of $198,647 (vs. $262,600 in '08); CBS's "The Big Bang Theory," during which a 30-second ad costs an average of $191,900, an improvement over last year's $135,357, thanks to a better time slot); and NBC's "The Office," which commands an average of $191,236 (vs. last year's $213,164) for a 30-second commercial, according to Ad Age's survey.

Some of TV's most-expensive programs won't make their debuts until 2010. According to the Ad Age survey, Fox's "American Idol" is fetching between $360,000 and $490,000 for a 30-second ad. Prices in the popular program often hinge on whether or not the ads run in those shows closer to the time when judges crown a winner.

Sunday night, filled with NBC's football and Fox's animation block, continues to be the costliest night of the TV season. CBS, bolstered by the success of its Monday-night comedies, sophomore drama "The Mentalist" and debuts of "NCIS: LA" and "The Good Wife," has usurped ABC as the costliest network on which to advertise. Meanwhile, ABC's "Flash Forward" is the most-expensive new program of the season, commanding an average of $175,724 for a 30-second ad. Fox's much hyped "Glee" comes in as the fourth most-expensive new show of the fall, at $127,350, as ABC's "Flash Forward," Fox's "The Cleveland Show" and ABC's "Modern Family" take the top three slots.

One of the cheapest new shows of the year is NBC's much-hyped "Jay Leno" program, where a 30-second spot can be had for an average cost between $48,803 and $65,678, depending on the night of the week.

The figures should be taken as directional indicators, not gospel. The estimates are based on what advertisers paid for ad time during the recent upfront market, during which marketers commit to pay for predetermined amounts of ad inventory months or weeks in advance in exchange for locking down price guarantees.

Already, the market has noticed that prices for scatter inventory, or ad time purchased much closer to air, is up "mid-to-high single" percentages above upfront prices, according to Wells Fargo Securities. That's good news for TV broadcasters, but not such good news for marketers readying holiday-season ads. Broadcasters held back, on average, 10% to 15% of time normally sold in the upfront, betting that they'd command higher scatter prices.

And it's worth noting that most TV advertising is typically purchased as part of larger negotiations, not on a one-off basis. Prices often depend on the advertiser's relationship with the network, the volume of inventory being purchased and the presence of nontraditional advertising, such as product placements.

The drops should come as little surprise to those who took part in one of the most prolonged upfront sessions in recent memory. With the economy weighing on marketers' ability to spend, advertisers waited until late August -- and until they felt TV prices had been negotiated down somewhat -- before committing to the fall schedule. Indeed, networks dithered over whether of not to hold back scatter until the last possible minute.

Also check out new social e-commerce site for artists: www.artistsforartists.com