This entry will be a little shorter than our usual blogs since it’s a follow up to the blog “Confucius Says” from May 3rd, 2016. In that entry, we shared an industry prediction from the Pivotal Research Group, who believed that in 2016 TV networks would be likely to seek CPM increases anywhere from 5% to 9%. Well, time has marched forward, the recent upfronts have ended and the figures are in. According to reporting in AdWeek Magazine, “This year’s broadcast national TV upfront ad sales will tally around $8.75 billion, a 4.7 percent increase from last year… On the cable side, upfront sales reached $9.86 billion, up 4.3 percent from 2015.”
Truth be told, some of this increase can be credited to buyers who are simply not quick to dedicate resources to new media like SVOD and VOD. But as a product placement agency whose singular objective is the exposure of our clients through product placements in film and television, we view a big picture though a narrow lens. We understand that the programming we’re placing products and brands into has a life well beyond the initial airing. While the media buyers at the upfronts are buying targeted slots and scatter (a media-purchasing strategy that is used by the television networks to sell air time at higher ad rates, and used by the advertising agency to position a product at the last minute), our brands remain with the production as it moves from its original airing to re-run, to re-purposing on Hulu or Amazon. So, we are less beholden to the limitations of the purchase of a single airing.
What this increase does reflect is some very good news for our clients, because it provides hard figures that prove product placement CPMs are arguably the best deal in the media buying business.