June/July 2005
VOL. 25 NO. 4

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Desired Ad Demos
Set to Change

By Valerie Milano

As Madison Avenue (as ad buyers tend to be identified) entered into the annual feeding frenzy known as the television upfronts in New York City, the yearly controversy over what demographic is really the most valuable, once again, provided fodder for endless industry quibbling.

For years, NBC has adamantly crowed that 18-49 was the only game in town that mattered, the true indicated of a network's success . . . until, that is, this year, when the net fell to fourth place in that demo.

For the WB, 18-34 became their profitable bread-and-butter demo at a time when people scoffed at the notion you could actually make money catering to teens and young adults. But as WB founder Jamie Kellner liked to point out, because those ratings points were scarcer and targeted, they were more valuable to select advertisers.

Some in the advertising business have dismissed the recent success CBS has had in the upfront because CBS's audience, while getting younger, is still older than its competitors'. But according to Viacom COO and CBS president Les Moonves, that's based on a stubborn misconception. "A lot of you [people say] the 18-49 is the demo most sought after by advertisers. Please do me a favor, call the advertisers. Call your local advertisers; call your national advertisers," he said. "We're not dismissing 18-49. It is important. But we're selling much more than 18-49."

His comments were based on a study conducted by Insight Express in partnership with MediaPost, in which over one thousand media professionals from ad agencies and buying firms participated, making it the largest such study in terms of sample size. The study indicated that the 25-54 age demo is now the most important to media buyers, in both the broadcast and cable universes. More surprising is the fact that the 35-64 demo is in a virtual dead heat with the 18-34 demo as far as advertiser desirability.

David Poltrack, executive vice president, Research and Planning at CBS Television, said, "Many members of the media have incorrectly assumed the 18-49 age demo is the audience segment that advertisers want to reach most; we as an industry have fallen prey to this fallacy. But that singular focus on adults 18 to 49 in the coverage of the television ad market has resulted in a distorted view of the economics of that market. As this definitive study shows," he said, "we shouldn't assume that the present currency of negotiation - in this case the 18 to 49 demo - is actually reflective of what is valuable to the buyer." Poltrack added that although NBC publicly touts the 18-49 group, it is less well-known that NBC's upfronts have been so successful in recent seasons because the net is, actually, the leader in 25-54.

Among the other findings of the study, which Poltrack stressed was not paid for by CBS, was that when planning or buying TV time, income and product usage were the next two important factors behind age and gender, and that these individual demos are included in ad agency specification for marketing campaigns. The three most important factors buyers point to when selecting television time were, in order: audience composition, reach and CPM. Content was a somewhat distant fourth consideration.

Nearly two-thirds of the respondents in the study believed that actual product usage will be used more often in the future as the primary measurement for TV campaigns. And over half of those surveyed believed lifestyle demographics are more important than age or ethnicity. Likewise, nearly 60 percent believed the population's coming-of-age will have a significant effect on their media purchases. Based on these findings, Poltrack concluded that for the foreseeable future, the 25-54 age segment - comprised of the younger half of the "Baby Boomers" group and the older half of "Generation X" viewers - will be the primary target for advertisers. "In the end," Potrack said, "from both a cultural perspective and an economic perspective, every viewer counts."

That said, on Madison Avenue, at least, not all viewers are created equal. For as much press as age demos attract, lower on the radar screen are the economic demos, which really set ad rates. One reason ABC is expected to enjoy such a bump coming out of the upfronts is not just because more people are watching the network thanks to several hit dramas; it's because of the earning levels of those viewers. Reaching upscale viewers has long been the secret to NBC's success with advertisers; the more people who watch their shows with incomes over $75,000, the more advertisers pay for those spots.

Currently, the highest indexing shows on television-The West Wing, Will & Grace and The Apprentice - remain under the Peacock banner. But both CBS and ABC are making a significant dent. NBC's king of the upscale mountain status has been eroded by ratings-friendly, but far less upscale, reality shows like Fear Factor and The Biggest Loser.

According to Nielsen, during the first month and a half of the current season, ABC managed to tie NBC in viewers 18-49 with incomes over $75,000. CBS has quietly secured the most viewers with incomes over $100,000. Overall, ABC and CBS have both increased their most buyer-desired demos by an estimated 20 percent, while NBC has tumbled. Though NBC won't concede defeat just yet, another season or two of slumping could seriously crimp the network's bottom line - especially if CBS remains level and ABC enjoys its anticipated growth curve.

Branding helps sell ad time too. Cable networks such as MTV enjoy advertiser interest because the buyers know exactly whom they will be reaching. As chairman Judy McGrath said, "MTV is the nation's number one media brand among young adults. We have the most loyal, creative and wired viewership in the world," and companies looking to reach that audience will gladly throw big advertising money MTV's way.

Likewise, although UPN has often been criticized for providing blocks of programs solely featuring African-Americans, advertisers prefer that strategy because it makes targeted marketing so much easier. And that keeps costs down and results high - music to any buyer's ears.

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