Spot Check by Janet Stilson

Auto Ad Market Shifting Back Into Gear

With an improving economy, TV stations and reps are seeing a return of car advertising. Predictions are the category will post improvements of up to 20% in the first quarter over the same period last year. And even better news is that the category's gains may be just one part of an overall ad improvement in 2010.
By
TVNewsCheck,

TV station executives and reps are sounding downright positive about the automotive advertising market these days, a critical category that has been in sharp decline for the past couple of years.

"The auto category is back in a big way," says Leo MacCourtney, president, Eagle TV Sales, part of the Katz TV rep family.

Story continues after the ad

Spending for the first quarter is up 40%-50% year-over-year at Eagle, with all three domestic car companies and several foreign manufacturers' contributing. "A very important piece of the spot market has returned."

By "putting pressure on inventory," MacCourtney says, the return of the auto dollars is also helping to bolster spot rates across the board.

Others are as enthusiastic about auto spending as well. Val Napolitano, CEO of  Petry Television, says that the category is currently pacing at over 50%, but predicts the quarter will end up at between 18% and 21%.

Car companies advertise heavily during the Olympics, which take place next month, he notes. And since no other TV event will attract auto dollars in equal volume this year, the first quarter will likely be tops for the year in auto.

Jane Williams, VP of sales for the Cox Media Group, says that the auto spending could be up 20%-30% for the station group when the books close on the first quarter.

Cox is seeing double-digit growth from dealers, she says, but it's the manufacturer money in national spot that's most pronounced.

The auto money is apparently not being evenly distributed, with larger markets getting the larger share.

"Cox has a lot of larger-market stations," says a TV station group head with stations in mid-size markets who asked not to identified. "Top 25-50 stations are getting dollars sooner and with larger volume. That said, I'm still very bullish where we're going to end up, in comparison with last year same quarter, as well as 4Q," the broadcaster adds. "We just aren't going to be seeing the same double-digit increases."

The auto spending began to stabilize in the fourth quarter. Napolitano says that quarter was flat to down 2%, but that was a huge improvement over the previous three quarters, which saw auto plunge 40%-50% over the prior year.

Everybody is pleased with the percentage gains, but all also point out that they represent increases against the first quarter of 2009, one of the worst anyone can remember.

Of the Detroit Three, only Ford was advertising at any significant levels last year in the quarter. GM and Chrysler were mostly looking for government handouts and fighting for their survival.

Nonetheless, the spending is boosting hopes for a solid advertising recovery this year.

The Television Bureau of Advertising's new president, Steve Lanzano, actually thinks the organization's 2010 forecast presented last September may be on the "low" side, if things continue to improve with the auto category. TVB estimated 2010 local spot would be up about 1%-3%, and national would be up 6%-12%.

"Our members are coolly confident that they will have good numbers in the first quarter, and some are even going beyond that," says Lanzano.

While he hasn't quizzed dealers on first-quarter spending, Paul Taylor, chief economist for the National Automobile Dealers Association, says an ad uptick makes sense.

"The economy grew in the third quarter and more robustly in the fourth," he says. "That suggests that dealers will be increasing their budgets now."

Charlie Sternberg, local sales manager for WRDQ Orlando, Fla., is certainly experiencing that. "We're seeing increases from some of the dealers that have continued to advertise with us through the recession," he says, citing Volkswagen, Hyundai and Toyota.

What's more, he adds, independent used-car dealers have "popped."

Gene Cameron, VP of auto marketing/media solutions at J.D. Power & Associates, expects auto unit sales will reach 11.6 million this year, a 15% bump over 2009.

But that doesn't translate into a 15% ad rise in the category for TV, he cautions. "There definitely will be some increase, but [car companies will] use online to gain efficiencies."

Auto ad spend has fallen so far over such a long period, the new increase is not taken for granted by anyone. Williams is well aware that things could play out much differently than broadcasters now think it will.

"We feel like we're on this house of cards that could fall," she says.

Spot Check is a bi-weekly column about TV station sales by Janet Stilson, a writer who specializes in the media business. If you have comments or ideas for future columns, contact her at 212-694-0126 or jstilson@nyc.rr.com.

Edit Article

Comments (0) -

Today's Top Stories

Classifieds

The Market

Symbol Last Change (%)
Nasdaq 2814.43 +35.64 (+1.28%)
NYSE 7507.36 +79.62 (+1.07%)
S&P 500 1307.91 +12.69 (+0.98%)
Updated 05/21 11:12a ET Quotes delayed at least 20 mins.
Source: Financial Content

Ratings

Overnights, adults 18-49 for May 17, 2012
  • 1.
    3.0/9
  • 2.
    2.5/7
  • 3.
    2.4/7
  • 4.
    1.5/4
  • 5.
    1.1/3
  • 6.
    0.3/1
Source: Nielsen
Reviews
Opinions
Features
  • David Wiegand

    Fans of Sex and the City have finally gotten their wish: Their beloved sex-focused sitcom is back on the air ... sort of. The four women have become four men, of course, and the writing isn't as good. Oh, and the laugh track so annoying, it's offensive. And did I mention that the costumes would be considered fashionable if you were holding a yard sale? Men at Work on TBS is almost quaint, it's so old fashioned. If it had any meat on its bones, you'd be tempted to say it's the sadly ignoble epitome of TV's long-festering emasculated-men syndrome. But it's so much of a big, forgettable, innocuous shrug, it's not even worth any actual vitriol.

  • Mike Hale

    The USA Network's motto is "Characters Welcome." Apparently they're especially welcome if they resemble Oscar Madison and Felix Unger. Already stocked with Odd Couple knockoffs in Psych and White Collar, USA adds to its inventory Common Law, another comic crime-fighting show about mismatched partners. But this latest entry exhibits very little of that kind of spark as it tries to wring laughs from the juxtaposition of counseling and police work. It looks too flat and schematically plotted to succeed as the type of lightweight summer fun we’ve come to expect from USA.

  • Joanne Ostrow

    Johnny Carson: Fantastic entertainer, miserable human being. That's the lasting message of Johnny Carson: King of Late Night, the new PBS American Masters film, a rich history of a rare product of television who dominated the small screen for decades. Unprecedented access to personal archives plus all existing episodes of The Tonight Show (1962-92), distinguishes this film by Peter Jones. Telling interviews with family and colleagues, including second wife Joanne Carson, former Tonight Show executive producer Peter Lassally and a number of biographers sharpen the picture. The clips are carefully selected to illustrate specific personality traits, the performance highlights are given context and meaning beyond funny lines and memorable moments.

  • Hank Stuever

    AMC's The Pitch is a sharply-made if slightly off-putting reality series that follows different advertising agencies each week as they compete for new accounts. The inspiration for the show — made clear by its own ad campaign — is to harness some of the verve generated by the network's acclaimed Mad Men. The Pitch has a way of making the ad world seem like a real downer — a repugnant exercise in egotism laced with depressing bouts of creative compromise.

  • Tim Goodman

    HBO's Veep stars Julia Louis-Dreyfus as former Sen. Selina Meyer, who accepts the vice presidential duty and regrets it almost immediately: She has no real power and gets muscled by the Senate, Congress and the (so-far-unseen) president, who delegates all the truly crappy jobs to her. Louis-Dreyfus has found perhaps her best post-Seinfeld role and takes to it with such fervor — the constant swearing, the barely veiled desire to become president, the unhappy give-and-take with other politicians and a delightful disdain for average citizens — that you can't help but applaud what is clearly an Emmy-worthy effort. Her work alone makes Veep a gem, but there's even more to like.

This advertisement will close automatically in  second(s). You will see this ad no more than once a day. Skip ad