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TV’s Trump Effect: Advertisers Focus on News, Late-Night Buys Ahead of Primetime (EXCLUSIVE)

Variety logo Variety 6/20/2017 Brian Steinberg
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President Donald Trump has roiled everything from national politics to environmental policy. Now he could be reworking the norms of TV advertising.

Advertisers are lining up in TV’s upfront negotiations to make advance commitments in news and late-night programs that are focused on the nation’s current stormy, politics-driven news cycle. In some cases, advertisers are chasing these shows even ahead of primetime fare, according to three people with knowledge of the discussions. These people say programs including “Today,” “Good Morning America,” “CBS This Morning,” “The Late Show with Stephen Colbert,” “The Tonight Show Starring Jimmy Fallon,” “Jimmy Kimmel Live” and others are getting more emphasis from Madison Avenue than in previous years.

There is a “Trump carryover effect,” said one media buying executive with knowledge of current talks.

U.S. TV networks try to sell the bulk of their ad inventory for the coming programming cycle as part of the industry’s annual upfront discussions.  In 2016, the nation’s five big English-language broadcast networks secured between $8.41 billion and $9.25 billion in advance ad commitments for primetime, according to Variety estimates, marking the first time in three years they managed to break the $9 billion mark. In 2017, however, there have been lingering questions as to whether the market for TV-advertising is cooling.

To be sure, late-night has experienced higher-than-usual demand from advertisers for several cycles. But the current push, buyers and other executives suggested, adds news to the mix and takes place before many agencies have negotiated substantial deals for primetime TV. In a typical upfront process, discussions around primetime buys usually take up the bulk of early haggling. Advertisers may sense the opportunity to put their commercials in front of a big audience at a price significantly less than the cost of a 3o-second ad in primetime fare like NBC’s “This Is Us” or CBS’ “The Big Bang Theory.”

What’s behind the surge? Media-buying executives suggest both consumer-packaged goods companies like Procter & Gamble as well as pharmaceutical manufacturers are sparking the dynamic. Pharmaceutical companies have long flocked to TV-news shows in both morning and evening time slots.

News of the negotiations surface as most of the media companies have written some upfront business for the 2017-18 season. CBS, NBCUniversal, ABC, the CW, Fox Networks Group, Discovery Communications, Viacom and Time Warner’s Turner are all engaged in active conversations with buyers.

The broadcasters have pressed in many cases for  CPM rate increases in the high-single-digit percentage to low double-digit percentage range, buying executives said, though advertisers have in most cases attempted to resist paying the high end. Cable networks have tried to tuck underneath the range that broadcasters are perceived to be betting.

It remains unclear whether the demand for the non-primetime programming has made its way over to cable. One buyer suggested CNN and Fox News Channel had yet to finalize a majority of deals, while another said the pharmaceutical surge had translated to demand for cable news. MSNBC is part of NBCUniversal, which has in recent years worked to sell advertisers broader packages of ad inventory across the company’s portfolio.

The networks have certainly proven willing in recent years to bring advertisers deeper into news programs and late-night shows. CNN has allowed sponsors like KPMG and Epix to run extra-long ads that look a lot like some of its programming. All of the networks, meanwhile, have allowed advertisers to buy perches in late-night segments that give them direct interaction with Fallon, Colbert, Kimmel and others. James Corden, host of CBS’ “Late Late Show,” works with an on-set bar that features beer from Heineken.  As advertisers ponder digital and social media, they seem to be drinking from different glasses as they ponder how to pay for TV commercials.

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