Research

Third-Quarter Long-Form Media Billings Rebound 17.6 Percent Over 2001

1 Jan, 2003 By: Shay Moftakhar Response

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Record-low media costs help timeslots exceed 300,000 mark.

For the third consecutive quarter in 2002, quarterly long-form media billings have outperformed 2001. This year's $33.5 million boost over 2001 brought the figure within $1.5 million of 2000's record third quarter. Capitalizing on declining media costs, the total number of timeslots purchased has finally exceeded the ever-elusive 300,000 mark.

 

Personal Involvement

The "diet, weight-loss, nutrition and food" category led the revival with a 132.8-percent improvement over third-quarter 2001. Next in line was the "other" category, with a 71.8-percent increase, followed by "personal development, self-help and education," which jumped 67.8 percent, and the "housewares and appliances" category's 38.7-percent improvement. In its fifth straight third-quarter gain, the "health and fitness" category advanced 16.8 percent.

 

The "crafts, collectibles and hobbies," "electronics" and "fundraising" categories led the losers with declines of 77.7, 71.5 and 60.5 percent, respectively. Marking their third straight third-quarter losses, the "sports and outdoor activities," "music and video" and "automotive" categories declined 57.1, 12.8 and 0.2 percent, respectively.

 

Time Warp

The long-form media distribution percentage breakdown between the three outlets remained practically identical to third-quarter 2001. The average cost of a half-hour block of time dropped another 5.9 percent from last year, settling at $720.19. This is a record low for any reported quarter. The previous low was recorded in third-quarter 1996 ($735.54 with 219,604 timeslots purchased). Media buyers didn't let a good deal pass them by this time, as they purchased 90,000 more timeslots than in 1996, pushing this quarter's total to 310,363. This is exactly 25 percent, or 62,160, more timeslots purchased than in third-quarter 2001.

 

The top 30 markets realized an overall 18.5 percent, or $22.9 million, increase over third-quarter 2001, bringing them back near 2000 figures. The top 10 markets gained 13.3 percent, markets 11-20 jumped 23.1 percent, and markets 21-30 rose 24.9 percent.

 

Good Times

The outlook for fourth-quarter numbers remains optimistic based on record consumer spending during the post-Thanksgiving weekend. The question always remains, however, "for how long?" Retailers and direct marketers are enjoying the glut of disposable income created by the drop in stock speculation and refinance frenzy - 600 percent over 2001. Stable gasoline prices and zero-percent new auto loans keep fueling the good times. However, many who needed to refinance already have, and a mounting consumer debt must eventually get paid off. Therefore, direct marketers must strike while the iron is still hot.

 

In stark opposition to the usual increase on media spending for long form during the third quarter, short-form DRTV spending actually decreased. While third-quarter long-form media buying gained 12 percent over second-quarter numbers, short-form DRTV media billings fell 12.7 percent.

However, spending in the top 30 markets did increase over the previous two quarters. In the third quarter, $36 million, or 42.6 percent of overall spending, was spent on the top 30 markets, while 31.3 and 24.3 percent were spent respectively in the first two quarters.

One explanation for this unusual drop in the third quarter would be the fact that many media-buying firms in our sample buy both long- and short-form media for the same products. Therefore, it may be wise for them to concentrate on the long-form campaign and sacrifice short-form DRTV while long-form prices are still cheap.

Another explanation could be that the advertising recession spilled over to short-form DR and the number of spots purchased may have actually increased while overall spending decreased. Tracking the number of spots purchased is as difficult as keeping track of an ant farm; therefore, it is a near-impossible task for short-form DRTV marketers to accurately report this enormous figure.

To keep numbers accurate with last quarter, Response surveyed the same group of short-form DRTV media buyers. As stated before, this is not a complete list of all short-form DRTV media buyers. However, it does represent a cross section of small, medium and large short-form DRTV media buyers. For now, the data collected will serve as a reference point on how this cross section of the industry is doing.

In future surveys, the staff of Response will be making efforts to broaden its survey base and include as many short-form media-buying firms as possible in order to accurately gauge the market in its entirety. We believe this is possible based on the success of our long-form media buying research and the continued support and participation we receive from the media buying community.

If you are a media buyer and were not contacted in this survey or for the long-form survey and would like to participate, please contact Thomas Haire, Response editor, at (714) 513-8850 or via E-mail at mailto:thaire@advanstar.com.

 

Methodology

Both the Long-Form and Short-Form Media Indices are conducted quarterly by the staff of Response. It represents in-house, non-brokered media billings for all agencies and marketers known to have purchased long-form (30-minute) or short-form (30-, 60-, or 120-seconds) media during second-quarter 2002. Companies that couldn’t or wouldn’t reveal their media billings by press time were estimated based on previous responses to surveys on the quarter in question and based on projects they were known to be involved with.

 

For the survey, the top 10 markets include: New York; Los Angeles; Chicago; Philadelphia; San Francisco-Oakland-San Jose; Boston; Washington, D.C.; Dallas-Ft. Worth; Detroit and Atlanta.

The next 10 markets are: Houston; Seattle-Tacoma; Cleveland; Minneapolis-Sarasota; Miami-Ft. Lauderdale; Pittsburgh; Denver; Phoenix and St. Louis. The numbers 21 through 30 markets are: Sacramento-Stockton-Modesto; Orlando-Daytona Beach-Melbourne; Baltimore; Indianapolis; Portland; Hartford-New Haven; San Diego; Charlotte; Milwaukee and Cincinnati.

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