Upfront 2010

Kids Cable Upfront Sees Ad Prices Rise

Rebounding Interest From Toy and Movie Marketers, Not to Mention Advertisers Seeking Adults

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Corrections have been made in this story. See below for details.

LOS ANGELES (AdAge.com) -- The kids upfront is 90% wrapped, on track to finish up at around $890 million, or 4% to 5% higher than last year's take.

Discovery Networks and Hasbro's 'The Hub' is set to launch in fall 2010.
Discovery Networks and Hasbro's 'The Hub' is set to launch in fall 2010.
Led by rebounded spending among toy makers, movie studios and certain food products, the kids TV market saw average cost-per-thousand-viewer ad rates increase by 6% to 7%, while a strong adult market led by Nickelodeon and Nick at Nite saw ad rates climb as much as 9%, according to multiple executives familiar with negotiations. The upfront is when networks sell up to 80% of their ad inventory ahead of the upcoming TV season.

Nickelodeon's adult-targeted programming, including Nick At Nite, and Disney XD saw the biggest gains, with revenue up 40% and 35%, respectively, as the smaller players continued to steal share from competitors.

"The broader marketplace is really accepting Nick as a place to reach adults," said Jim Perry, Nickelodeon's exec VP-brand sales. "The co-viewing story is very strong whether it's moms watching TV with their kids or parents watching 'Spongebob' and 'iCarly' with their older kids."

That increased adult money is also the key to the kids TV market's overall growth, as new players such as Discovery and Hasbro's the Hub and Disney's forthcoming preschool network Disney Junior start to enter the marketplace. After last year's marketplace was gutted by the loss of as much as $120 million in FCC-restricted food spending, other categories have been slowly picking up the slack from cuts made by Kellogg, General Mills, Kraft and others. Nick At Nite saw increased spending from consumer-package goods, insurance, retail and automotive brands like General Motors, which bought a block of high-profile programming in first-quarter.

Marketers such as Lego, Spinmaster and brands such as MGA's Bratz dolls led spending among toys, which continued to be the kids market's largest category. Movies, which recently replaced food as the No. 2 kids category, also held strong as studios including Sony, Fox, Paramount and Disney prepare more kid-targeted films for the upcoming quarters. Food saw a 3% to 4% rebound this year, as Kellogg products like Pop Tarts returned to the marketplace while Campbell's recently reformulated healthy soup emerging as an aggressive player.

Cartoon Network, despite continued ratings losses in 2009, saw cost-per-thousand increases of 5% to 7%, according to two executives familiar with negotiations, adding new business among apparel and retail marketers. Cross-platform promotions and new programs like "Hall of Game" also attracted significant interest among sponsors.

"We are appreciative that the marketplace continues to trust and value Cartoon Network," said David Levy, president of sales, distribution and sports for Turner Broadcasting System.

One player that has yet to wrap business is the Hub, which was doubly challenged going into this year's market both as a 50%-owned property of Hasbro and a new network without a year's worth of ratings points to sell off of. Toy marketers were still believed to be taking the wait-and-see approach to buying time on a competitor's network before its Oct. 10 launch, said one buyer, and the Hub's bullish attempt to attract mom-targeted dollars has not yielded as much volume as anticipated.

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CORRECTION: An earlier version of this story said Nick At Nite saw a 40% increase in ad revenue in this year's upfront. That figure should be attributed to all of Nickelodeon's adult business, which includes Nick At Nite. Also, Bratz is a MGA brand, not a Mattel brand as the article originally said.

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