Why TV Advertisers Are Spending More for Less This Season

Ad Age Survey Finds Buyers Anticipate Modest Commercial Ratings From Networks' Fall Lineup

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What will be watched
ABC CBS NBC FOX CW
7 P.M. (ET) America's Funniest Home Videos
4.17
60 Minutes
7.83
Football Night in America
3.2/5.9
The OT
7.15
8 P.M. (ET) Extreme Makeover: Home Edition
5.48
The Amazing Race
5.43
Sunday Night Football
10.9
Minute to Win It
2.8
Celebrity Apprentice
3.94
The Simpsons
3.82
The Cleveland Show
3.36
Bob's Burgers
2.9
9 P.M. (ET) Desperate Housewives
7.14
Undercover Boss
6.59
Family Guy
3.93
American Dad
3.06
Cleveland Show
3.36
10 P.M. (ET) Brothers & Sisters
5.64
CSI Miami
6.65
ABC CBS NBC FOX CW
8 P.M. (ET) Dancing With the Stars
10.3
The Bachelor
4.7
How I Met Your Mother
4.53
Rules of Engagement
4.7
Chuck
3.02
House
6.0
90210
1.04
9 P.M. (ET) Two and a Half Men
7.57
Mike & Molly
5.98
The Event
3.59
Lonestar
3.89
Ride-Along
4.02
Gossip Girl
1.12
10 P.M. (ET) Castle
5.45
Hawaii Five-O
7.25
Chase
3.49
ABC CBS NBC FOX CW
8 P.M. (ET) No Ordinary Family
4.6
NCIS
10.8
The Biggest Loser
4.96
Glee
4.42
American Idol
10.37
One Tree Hill
1.04
9 P.M. (ET) Dancing (results show)
8.33
Mr. Sunshine
4.7
Happy Endings
3.04
NCIS: Los Angeles
8.84
Raising Hope
3.09
Running Wild
3.09
Mixed Signals
4.34
Life Unexpected
1.05
10 P.M. (ET) Detroit 1-8-7
3.86
The Good Wife
7.67
Parenthood
3.79
ABC CBS NBC FOX CW
8 P.M. (ET) The Middle
3.5
Better Together
3.47
Survivor
6.25
Undercovers
3.97
Lie to Me
2.74
Raising Hope
3.09
Idol results
10.2
America's Next Top Model
1.65
9 P.M. (ET) Modern Family
4.62
Cougar Town
4.14
Criminal Minds
6.99
Law & Order: SVU
4.80
Hell's Kitchen
3.43
Glee
5.76
Hellcats
1.11
10 P.M. (ET) The Whole Truth
3.57
The Defenders
6.53
Law and Order: Los Angeles
4.89
ABC CBS NBC FOX CW
8 P.M. (ET) My Generation
4.83
V
4.9
Big Bang Theory
6.31
$#*! My Dad Says
5.76
Community
2.69
30 Rock
3.18
Bones
5.33
Vampire Diaries
1.68
9 P.M. (ET) Grey's Anatomy
7.34
CSI
8.14
The Office
4.01
Outsourced
3.29
Fringe
3.37
Nikita
1.47
10 P.M. (ET) Private Practice
5.0
The Mentalist
8.73
Love Bites
3.49
ABC CBS NBC FOX CW
8 P.M. (ET) Secret Millionaire
2.68
Medium
4.2
Who Do You Think
3.38
School Pride
3.12
Human Target
3.32
Smallville
1.19
9 P.M. (ET) Body of Proof
3.0
CSI NY
5.53
Dateline NBC
4.45
Good Guys
2.38
Kitchen Nightmares
2.0
Supernatural
1.09
10 P.M. (ET) 20/20
3.98
Blue Bloods
4.84
Outlaw
3.69
ABC CBS NBC FOX CW
8 P.M. (ET) College Football
3.6
Crimetime Saturday
2.45
Encores (Undercovers)
1.56
Cops 1
2.62
Cops 2
2.9
9 P.M. (ET) Crimetime Saturday
2.98
Encores (Chase)
1.99
America's Most Wanted
2.93
10 P.M. (ET) 48 Hours Mystery
3.79
Encores (Law & Order: SVU)
3.13
Note: Chart reflects the C3 ratings media agencies expect shows to earn. A household rating is an estimate of the size of a TV audience relative to the total universe of homes with TVs. Nielsen estimates there are 114.9 million U.S. TV households, so a single national household ratings point is equal to 1%, or 1,150,000 households.

NEW YORK (AdAge.com) -- After forking over price increases of 7% to 10% for ad time on broadcast TV in the recent upfront market, advertisers are likely to blanch at a disquieting fact: They are paying more for less.

For the upcoming fall season, TV ad buyers have projected a 10.3 household C3 rating for ABC's popular 'Dancing With the Stars.'
For the upcoming fall season, TV ad buyers have projected a 10.3 household C3 rating for ABC's popular 'Dancing With the Stars.' Credit: ABC
Ad buyers are projecting noticeable declines in household commercial ratings across the prime-time grid for the coming fall season, according to Advertising Age's annual survey of ratings estimates from media-buying firms. The estimates reflect modest expectations for the broadcast networks' new programs and tough comparisons with year-earlier predictions.

Ad Age's survey is compiled by averaging fourth-quarter and first-quarter estimates for household commercial ratings from four major media-buying agencies. C3, the shorthand term for commercial ratings , measures the number of viewers who actually watch commercials during a selected program rather than changing channels or fast-forwarding past them with a digital video recorder. Viewers who watch ads live as they run or as many as three days after they air are included in the ratings . Since the start of the 2007-2008 TV season, advertisers have crafted transactions based on C3 ratings , which take into account the number of viewers who watch commercials during a program, rather than the traditional ratings for the program itself.

The projections suggest significant audience erosion. For the recently completed 2009-2010 season, for example, ad buyers had projected a 14.1 household C3 rating for ABC's popular "Dancing With the Stars," a 13.1 for CBS's widely watched "NCIS" and a 13.7 for the Tuesday airing of Fox's "American Idol." But for the coming cycle, they envision those programs will generate household C3 ratings of 10.3, 10.8 and 10.37, respectively. At present, a single ratings point equals about 1.15 million households.

What's the problem? Media buyers suggest the declines in viewership for commercials by the demographic most coveted by advertisers -- consumers between the ages of 18 and 49 -- fell in a range of 5% and 11% in the recently completed season, depending on which of the four networks was being measured. Simply put, they aren't certain the TV networks can reverse the trend.

Few returning shows have a track record suggesting growth is in the offing, said one media-buying executive. Some veteran programs have simply matured, and some shows ready for their sophomore outing didn't show much promise in their freshman year, this buyer said. Those programs that do have some growth potential appeal to an extremely loyal following, this executive said, making it tough to envision people who haven't already caught on will try to get onboard. Broad-based general-entertainment networks are suffering from a similar fate, this executive said.

Increasing costs
Penetration of DVRs into consumers' homes has also begun to slow, according to estimates from Interpublic Group's Magna Global. The TV networks often suggest that increased use of DVRs helps bolster commercial ratings , because consumers spend more time recording top broadcast programs for later use (even so, the majority of them fast-forward past the ads).

ABC, CBS, NBC and Fox either declined to comment or were unable to make executives available for comment. All the broadcast networks sold more ad inventory at higher prices in this year's upfront marketplace than they did last year, which suggests advertisers are seeing the cost of reaching 1,000 people -- a negotiating measure also known as a CPM -- increase as the ability to draw that number of people at any given moment to the TV screen is diminished by competing digital media.

The C3 comparisons may be tougher than they ought to be. Ad buyers say last season's projections were likely bumped up a notch or two, owing to the fact that they were based on higher-than-normal ratings from the 2008-2009 season. That season included boob-tube coverage of the presidential election and inauguration.

The fall schedule still has a bright spot or two. NBC will be able to eke out some gains in 10 p.m. over its ill-fated "Jay Leno Show," according to ad-buyer projections. "Chase" on Monday nights and "Law & Order: Los Angeles" on Wednesday nights will generate better commercial viewership than "Leno" was able to in the prior season, according to comparisons with last season's estimates. Likewise, Fox's "Glee" will show an increase in household commercial ratings when it airs Wednesdays in the season's second half, according to the projections.

The freshman show likely to generate the greatest viewership of commercials that support it is CBS's revival of "Hawaii Five-O." The show's projected 7.25 household C3 rating is greater than that of any other new program set to launch in the 2009-2010 season.

Meanwhile, live sports and broad-skewing talent contests continue to generate the greatest commercial viewership. NBC's "Sunday Night Football," Fox's "Idol" and ABC's "DWTS," along with the popular CBS drama "NCIS," are all expected to generate a double-digit household commercial rating, a feat few regular shows can match.

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