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CBS Expects to Finish Upfront With Volume Increase

CBS expects to wrap its upfront sales with a greater volume of advance ad commitments than it did last year, one of the first tangible signs that advertisers are moving money back into TV after experimenting for several years with digital competitors.

The network expects to secure between 3% and 5% more volume than it won compared with its performance in 2015, according to a person familiar with the situation. In 2015, the network known for “The Big Bang Theory” and “NCIS”  notched between $2.19 billion and $2.48 billion in pre-season ad commitments, according to Variety estimates. The new figures suggest CBS could have secured between $2.26 billion and $2.6 billion in ad commitments for its next programming cycle.

CBS did not make ad-sales executives available for comment. In recent years, CBS Chief Executive Leslie Moonves has offered details on the network’s upfront performance during the conference call the company typically holds with investors to discuss its second-quarter results.

In discussions with advertisers, CBS pressed for significantly higher increases in the rates it charges to reach 1,000 viewers, a metric known as a CPM that is integral to these annual discussions between TV networks and Madison Avenue. During the “upfront,” U.S. TV networks try to sell the bulk of their ad inventory for the coming season. CBS pushed for CPM increases in the low double-digit percentage range, according to people familiar with the situation, compared with last year, when it sought between 3% and 5%.

Commitments do not represent cold, hard cash, but are an indication of what advertisers intend to spend in the months ahead. As such, CBS’ ability to secure a volume increase suggests Madison Avenue is thinking about TV in a new way after spending several years experimenting with social media and streaming video. While movie studios and automotive marketers are said to be spending less in this year’s talks, consumer products giants are seen moving money back into the TV upfront from digital venues as well as from budgets previously earmarked for so-called “scatter” advertising, when ad time in purchased much closer to air. CBS also saw higher interest from retailers, telecommunications marketers, pharmaceutical advertisers and financial-services companies, according to the person familiar with the situation.

CBS expects to sell more inventory than it did last year, another sign that advertiser interest has been robust. The network typically sells around 7o% to 80% of its ad inventory in the upfront, moving closer to the higher figure when demand is higher.

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