Syndicated TV: 'X-Files' Usurps 'Seinfeld,' for Number Two Barter Price Slot. 'Home Improvement' Still Number One.

Syndie TV Spot Prices Drop Overall

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Off-network sitcoms again account for the most prized inventory sought by national marketers, according to an Advertising Age survey of agency media buyers who handle syndication.

The three most expensive national barter advertising units in the national syndicated TV marketplace were off-network series "Home Improvement" and "Seinfeld" and newcomer "X-Files."

"X-Files" actually moves into the No. 2 position at $92,000 per 30-second spot (see chart at right), just ahead of "Seinfeld" at $81,000 per 30-second spot.

"Home Improvement" remains the top-priced syndicated offering at $105,000 per 30-second spot.


In fact, six of the 10 shows with the most expensive advertising time are off-network shows compared with only four last year.

Paramount's "Entertainment Tonight" continues to be the most expensive first-run syndicated series, followed in the same first-run ranking as last year by "Wheel of Fortune," "Star Trek: Deep Space 9" and "Jeopardy!"

Nonetheless, syndicated TV media buyers say 30-second ad unit pricing for most shows is slipping. National marketers are not willing to pay top dollar for shows with decreasing ratings.


At the suggestion of media buyers, this year's survey was modified to reflect "adjusted" advertising prices for syndicated shows, or the price paid per 30-second unit after "cash-back" payments are applied to audience underdelivery of ratings projections.

While buyers responding to last year's survey were asked the more open-ended question of what they paid for an average unit rate, this year's respondents insisted on the more stringent criteria of adjusted rates, because they contend that is the way syndicated TV shows are now estimated and bought.

"In syndication, the prices you pay initially are totally unrepresentative of what the actual costs are that you end up paying," says Arthur Schreibman, president of Botway Group, an independent media buying agency. "And that is a major source of irritation for us."


As a result, media buyers say syndication historically has the biggest "spread," or gap between the audience estimates forecasted by buyers and those projected by sellers.

Since prices are based on anticipated audience delivery, that spread inflates the initial prices paid for syndicated shows more than any other national TV medium, according to the buyers. This is the reason they have switched to "adjusted" price projections for syndicated shows.

"The unit cost is sacred in syndication. They will do whatever they can to preserve that, at least upfront," says David Lerner, partner-broadcast account supervisor, Ogilvy & Mather Worldwide, New York.

To deal with this phenomenon, some agencies have begun insisting the syndicated programming packages be priced to account for a more approximate delivery of audience projections. Some even ask that the packages be re-priced on a quarterly basis.

"It helps keep them honest and gives us greater flexibility," says one top syndication buyer.

According to the buyer, the strategy enables marketers to make more immediate adjustments to their advertising schedules to compensate for underdelivery of audience impressions in the syndication portion of their mix.


While direct comparisons were not available between this year's and last year's price survey, most buyers surveyed say their average unit costs were lower than what they paid last year and they believe that was true for the overall syndication marketplace.

"It makes sense that unit costs are down across the board, because ratings and share are down for most syndicated shows," says Mr. Schreibman.

While lower ad costs may seem counterintuitive following last spring's upfront syndication marketplace, in which cost-per-thousand rose into double-digits, according to Mr. Schreibman, CPMs would have had to increase just to keep ad units even in light of the ratings erosion.

Or, as another top syndication buyer puts it: "It is necessary for a lot of shows to reduce their unit rate, if they want to hang around. If they were a 7 last year and now they're a 5 rating, they would have to adjust those rates downward, even if their CPMs were up."


Though direct comparisons cannot be made to last year's price estimates, some patterns are apparent. Top off-network shows command a disproportionate advertising value to comparable first-run hits.

While "X-Files," "Home Improvement" and "Seinfeld" rank near the top of all syndicated shows season-to-date, they still trail "Wheel of Fortune" and "Jeopardy!" which continue to dominate on a U.S.-house ratings basis.

"The Oprah Winfrey Show" continues to lead the pack of syndicated talk shows, commanding a price significantly higher than its closest talk competitor: "Rosie O'Donnell Show." But "Rosie" is not too far behind "Oprah."

In fact, "Rosie" was the only one of the shows ranked in last year's survey to improve on its average 30-second unit rate in this year's survey -- in spite of the more stringent criteria of adjusted rates.


Overall, most talk shows dropped dramatically in advertising value. Not one of the major advertising agencies surveyed for this report acknowledged buying "Jerry Springer Show" or "Maury Povich Show," and only one said it bought "Jenny Jones" at an estimated average unit rate of $17,000 per 30-second spot.

The only other show (from the AA/EM sample) in the top 50 season-to-date Nielsen Media Research rankings that failed to generate a buy was the off-network run of "Married . . . With Children."


Formerly red-hot talk show "Ricki Lake" has had a sharp drop in advertising demand, and now ranks below "Sally Jessy Raphael Show" "Montel Williams Show" and all other talk shows, save one -- "Geraldo."

CNBC's "Geraldo" is the bottom-rung talk show, fetching a mere $6,000 per 30-second ad unit in this year's syndicated TV marketplace.

Mr. Mandese is senior VP of Myers Report.

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