SPOT TV BUYS SURGE IN 1ST QUARTER

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Spot is hot.

That's the word from media buyers and sales reps, who say spot TV is experiencing its first significant ad sales gains in two years, the latest sign that the media marketplace is responding to economic recovery.

With renewed spending in virtually every product category and the added impetus of the 1994 Winter Olympics and some $250 million in political ad dollars, TV reps are projecting first-quarter spot spending may show double-digit increases.

By comparison, spot TV spending in the first quarter of 1993 fell 2% from the same period in '92, also an Olympics and election year.

Katz Television, New York, was initially projecting spot TV sales would climb 6% to 7% in the first quarter but, based on January sales performances, has revised its projection to a 9% to 10% gain. Exec VP James Beloyianis said January 1994 outpaced the same period in 1993 by 10% to 12%.

Blair Television, meanwhile, projects spot TV spending in the first quarter will rise 6% to 8% over 1993, with all categories except package goods showing significant growth.

And Katz President Tom Olson said the package-goods category is being dragged down by only one advertiser.

"Package goods are up with the exception of Procter & Gamble, which has cut spending in spot TV," he said. "But we're running into people like American Home Products that have not been active in spot and had shifted money into things like syndicated barter TV time. We read that as a pretty encouraging sign."

Indeed, while P&G is down sharply-cutting its spot TV budget about 30% through the first three quarters of '93-that loss is being more than compensated for by growth from such key categories as domestic and imported autos, telecommunications and fast-food.

"The economy is looking better and consumer confidence is improving," said Katz's Mr. Olson. "The expectation is that even though the economic recovery may not be all that robust, at least it's improving."

Several other factors have improved spot's performance as well, including a tight national TV marketplace for the networks, cable and syndication, and an overall shift away from promotional spending and toward brand advertising.

Media buyers agree.

"We think the first quarter will be up as much as 7%," said Bill Koenigsberg, president of Horizon Media. "All the signs are there."

Mr. Koenigsberg estimates that the Olympic and political spending should account for about 2 points of that growth-factoring out that spending suggests about 5% in real growth.

He said Horizon is projecting an overall increase of about 5% for spot TV in 1994.

Fourth-quarter figures are not yet available, but through the first nine months of 1993, spot TV ad spending was up only 1% to $3.9 billion, according to a Television Bureau of Advertising analysis of data from Competitive Media Reporting.

"Things have improved dramatically," said TVB President Ave Butensky. "Based on the projections we have right now, we think TV ad revenues will surpass newspaper ad spending by 1995," making TV the nation's largest ad medium.

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