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Upfront 2015: Advertisers Rush To Latenight To Catch Colbert, Fallon, Kimmel

Madison Avenue is rushing to stay up late.

Advertiser interest in latenight television is more intense than it has been in years, media buyers say – so much so that sponsors are willing to pay bigger price increases to advertise on latenight TV shows than they are in primetime.

“I just think latenight is the hot daypart,” said Billie Gold, vice president and director of buying and programming research at Carat, a large media-buying firm. “There are days when latenight’s 18-to-49 numbers are higher than shows in primetime.”

To be sure, advertiser interest in the category has already been heightened in recent years, owing to the debut of Jimmy Kimmel in the 11:35 p.m. slot at ABC in 2013 and Jimmy Fallon’s well-received reworking of NBC’s venerable “Tonight Show” in 2014. Now, CBS is ratcheting up the fray by introducing two new entrants. James Corden has already launched his version of “The Late Late Show” at 12:37 a.m., while anticipation is high for the debut of Stephen Colbert in a retooled “Late Show” on CBS set to start September 8.

At CBS, marketers are talking about deals for new latenight offerings that call for a hike ranging from 6.5% to 8% in the cost of reaching 1,000 viewers, according to ad buyers and other people familiar with the situation. The measure is also known as a CPM and is central to the annual “upfront” talks currently taking place between advertisers and TV networks for commercial inventory that will support TV’s coming fall schedule.

NBC is said to be seeking CPM hikes of at least 10% for latenight offerings that include Fallon’s “Tonight Show,” “Late Night with Seth Meyers,” “Saturday Night Live” and “Last Call with Carson Daly.”  In some cases, the network may be pressing for CPM increases of as much as 15% for Fallon’s program alone, according to a person familiar with the situation. ABC is seeking hikes of 10% or more for “Jimmy Kimmel Live,” according to media buyers. In some cases, ABC ad executives are pressing for 12% to more than 15%, according to a person familiar with the matter.

The rates are eye-popping, and in some cases hard to believe. Primetime TV hasn’t benefited from double-digit CPM increases since a 2010 rebound from a recession in the prior year. Indeed, many of the networks offer packages of latenight programming, making apples-to-apples comparisons of advertising terms difficult.

What is grounded in fact is that interest in the shows is on the rise, owing to a belief that the entrance of Colbert on the cusp of a U.S. election cycle is going to stoke the competitive fires at NBC and ABC and create very compelling content that will spill out to digital and social media. “It’s a new game,” said Gold.

Others are benefiting as well. At Viacom, executives are seeing robust interest in “The Daily Show,” and its new host, Trevor Noah, who is slated to take over the program September 28. Advertisers have been willing to pay the same CPMs for Noah’s 11 p.m. program as they are for the current host, Jon Stewart, according to a person familiar with the matter. Viacom has hopes that Noah will bring a new set of younger viewers to its schedule and line them up to also sample “The Nightly Show,” a companion program featuring Larry Wilmore that starts at 11:30 p.m.

Advertisers interested in the programs include movie studios and beverage marketers. Even Kellogg Co., best known for sales of morning-table staples like Corn Flakes or Rice Krispies, has in recent months turned to latenight TV to prod viewers into making a choice for breakfast.

Fueling sponsors’ interest in latenight is the fact that it costs less than primetime. Yes, the hikes in price are robust, but the absolute cost to a major sponsor is relatively cheap. In recent years, the cost of a 30-second commercial in latenight has ranged from $25,000 on the low end to around $45,000. That’s significantly cheaper than the cost of a similar spot in a top-tier primetime show like “The Big Bang Theory” ($322,891, according to a Variety survey of primetime ad prices) or “Scandal” ($217,423).

Advertisers are using wee-hours programming to get closer to younger viewers, who pass along sketches and snippets from the various shows via social media. That dynamic creates new opportunities for sponsors who want to be part of new consumer routines that make use of streaming video and mobile devices.

The battle for ad dollars extends beyond four networks. Time Warner’s TBS airs Conan O’Brien’s latenight show and is expected to run new programs featuring the host making in the midst of interesting travels, emulating a recent special that showed him journeying to Cuba. TBS is also expected to launch in the near future a latenight show featuring former “Daily Show” correspondent Samantha Bee. Viacom’s CMT recently launched a four-night-a-week talk show hosted by comedian Josh Wolf. And National Geographic Network has given a second-season nod to a new weekly latenight program focused on science led by astrophysicist Neil deGrasse Tyson.

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