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Upfront 2015: Time Warner’s Turner Sees Volume as Flat to Down

Time Warner’s Turner expects the volume of advance advertising commitments for its coming programming to be in line with a market that is seeing volume drops by as much as a low-single-digit percentage, if not more. Turner is the latest TV company to complete the majority of its negotiations in what has been a tough marketplace.

Turner, which operates TNT, TBS, CNN and Cartoon Network, among other properties, has concluded negotiations with several large media-buying agencies, a person familiar with the matter said. Based on those talks, its volume of advertising commitments placed for the coming programming cycle could be flat to down as much as a low-single-digit percentage from what it secured in 2014. A media buyer familiar with the pace of negotiations suggested Turner’s overall volume could be down slightly more — as could the general marketplace.

Advertisers in 2015 have cut the amount of money they are willing to spend on TV commercials, according to media buyers. Madison Avenue is placing more emphasis on new forms of promotion, including social media, streaming video and mobile advertising.

Turner sought increases of around 4% in the cost of reaching 1,000 viewers, a measure known as a CPM that is integral to these annual talks between advertisers and TV networks. In 2014, Turner pressed for CPM increases of around 8%. In some cases, the media buyer said, the company may have accepted a lesser rate of increase at some of its networks in 2015.

The Fox broadcast networks expects to secure fewer advance ad commitments in this year’s upfront, when U.S. TV networks try to tell the bulk of their ad inventory for the coming season. Ad buyers believe volume is also down at CBS.

To help spark upfront talks, Turner burnished a set of data initiatives aimed at helping select advertisers achieve a particular result, such as lifts in brand recognition, purchase intent or awareness of a specific marketing effort, like a loyalty program — even going to far in some cases as to offer guarantees. The company also worked to sell its entire suite of networks together, rather than having, say, CNN or Cartoon Network make an individual effort. In the past, the company has let different networks make different approaches to Madison Avenue.

In its presentation to advertisers this year, Turner promised a better quality of scripted programming at TBS and TNT under new entertainment head Kevin Reilly (above, pictured, next to actor Jack McBrayer), as well as new special featuring latenight host Conan O’Brien.

Turner brought in $10.4 billion in total revenue in 2014, according to Time Warner earning statements. The unit notched a slight gain of $34 million, or 1%, in advertising revenue for the year.

Advertisers proved more interested in Cartoon Network than they have in years past, said the person familiar with the situation. The kid-focused outlet was able to grow its ratings slightly compared to the year-earlier cycle, and this person suggested Cartoon Network could have taken share of volume from its rivals.


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