Long-Form Media Billings Rise $3.2M, Set a 1Q Record1 Jul, 2009 By: Shay Moftakhar Response
Give My Regards to Broadcast
Two of the three forms of media distribution reported gains this quarter, but with a very strong caveat. National cable rebounded from its 1Q 2008 loss of $14.2 million with a powerful 23.7-percent resurgence of $33.7 million. Satellite advanced for its second consecutive first quarter with a 4.8-percent increase of $1.1 million. Broadcast reversed its 1Q 2008 gain of $28.3 million with a whopping 19.8-percent decline of $31.6 million. However, this loss in no way reflects the outburst of activity experienced in the number of time-slots purchased for this medium.
Fig. 4 First-Quarter 2009 Long-Form Media Distribution
The total number of timeslots purchased exploded by 27.2 percent, earning an extra 127,193 timeslots over 1Q 2008 totals. First-quarter 2009 upended the previous overall record — 2Q 2008's 500,309 — by nearly 100,000 timeslots. Fire sale prices for broadcast gave it a 27.8-percent gain of an extra 90,368 timeslots purchased, almost doubling its 52,187 increase of 1Q 2008. This increase translates to a 37.3-percent ($183.09) decline in its average cost — $308.43 in 1Q 2009.
National cable enjoyed a 21.6-percent increase — an additional 24,105 timeslots — while satellite added 12,725 timeslots (a 40-percent jump). Both categories rebounded from 1Q 2008 declines — 6,747 and 10,772 timeslots respectively. This unusual outburst in the extra number of timeslots purchased managed to push the average cost of a half-hour block of time to a new all-time low of $552.30 — 20.6-percent or $143.19 lower than 1Q 2008. This number is also 4.6-percent ($26.79) below 3Q 2008's previous all-time record low.
Fig. 5 Number of Time Slots and Percentage of Total Time Slots Purchased in First-Quarter 2009
Spending in the top 30 markets declined 11.9 percent, resulting in a $22.9 million loss. Top-30 spending in 1Q 2009 represented 51.7 percent of total spending, down from 1Q 2008's 59.3 percent. The top 10 markets slid 29.5 percent and markets 11-20 dipped 6.4 percent. However, markets 21-30 continued to increase with an $8 million gain (18.5 percent). This increase is in step with 1Q 2008's $7.88 million advance for these markets.
Fig. 6 Average Cost of a Half-Hour Block of Time Purchased in First-Quarter 2009:
Death of a Pitchman
Will 2009 be a redux of 2008? One year ago, long-form DRTV billings started with a strong first quarter and an increase over the previous year. However, the year ended with a 3-percent decline overall compared to 2007.
Plummeting advertising costs will keep the industry alive, but in no way guarantee growth. As usual, everything will be decided in the end game — or even earlier.
As a side note, the tragic demise of ubiquitous pitchman Billy Mays will have an interesting impact in the following quarters as both long- and short-form marketers try to decide if viewers will continue watching his infomercials for curious nostalgia or flip the channel in morbid sadness.
Either way, his impact in raising the profile of the industry through his recent reality show with Anthony Sullivan (Discovery Channel's "Pitchmen") and his pitching dozens of products will definitely leave a void. He picked up where Ron Popeil left off, and the industry will be looking for someone to fill his blue shirt, khaki pants and black beard.