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Univision Sees Heavier Demand for Ads as Upfront Wraps (EXCLUSIVE)

Madison Avenue seems to have more to say to Spanish-speaking TV viewers.

Spanish-language broadcaster Univision expects the volume of advance advertising commitments for its next programming cycle to rise after wrapping its negotiations in TV’s annual “upfront” market, according to a person familiar with the matter. This person says Univision saw its overall volume grow between 5% and 6% over last year’s efforts, driven in part by an influx of new advertisers and expanded budgets from current clients.

The results represent Univision’s best from an upfront market in four years, this person said.

The company’s ad-sales efforts come to light after it announced last week that its board of directors was exploring strategic options, which could include a potential sale, and hired Morgan Stanley & Co. LLC, Moelis & Company LLC and LionTree LLC as financial advisors to assist with the process.

Many media companies have struck favorable terms in this year’s “upfront,” when U.S. TV networks and advertisers haggle over prices for billions of dollars in advertising inventory. While linear TV is losing live viewership steadily to on-demand streaming video, Madison Avenue has yet to be convinced fully of the value of some of its newer options. Marketers are frustrated by the low quality of some video available on YouTube and skeptical of some of the measurement of audience available from Facebook. What’s more, some video-streaming giants, such as Netflix and Amazon, do not incorporate traditional video commercials into their video options.

Univision, like several other big TV networks, pressed for increases in the rates it charges to reach 1,000 consumers, a measure known as a CPM that is critical to these annual negotiations. Univision sought CPM increases in the mid-single-digit percentage range, according to the person familiar with the situation, double what it was able to secure in last year’s negotiations.

Ad demand was bolstered by telecommunications advertisers, tech marketers, pharmaceutical manufacturers and retailers, according to the person familiar with the talks, while demand was less robust from some of the nation’s big advertisers of consumer packaged goods.

Univision took in nearly 1.55 billion in advertising in 2018, according to the company’s 2018 financial report,  marking a 9.4% dip from the nearly $1.71 billion it secured in 2017. Upfront commitments represent directional indicators, not cold, hard cash. Advertisers can reallocate the money they vow to spend, so there’s little to tie market results to actual figures.

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