Ad Track: Networks find ads for fall shows a tough sell

Add advertising to the long list of items that aren't selling these days. As the fall TV season fast approaches, ad inventory for the shows still sits around like unsold houses, cars and clothes.

The spring "upfront" ad sales season has become the summer ad sales stalemate. Ad buyers and sellers typically move about $9 billion worth of ad inventory before Memorial Day.

This year, while some deals are just starting to trickle in, the networks and advertisers remain at odds over pricing:

•Advertisers want double-digit discounts.

•Media-buying agencies that help broker the deals for ad time think more moderate discounts of 7% to 8% would be realistic.

•The broadcast TV networks are holding out for cuts of no more than 1% to 2%.

Sales of fall ad time are "moving at a glacial pace," says Elizabeth Herbst-Brady, president of Magna, which handles buying for dozens of national advertisers.

"We are in an unprecedented time, and so it is certainly not a surprise that everyone is proceeding cautiously, prudently, intelligently and is under even more pressure to deliver meaningful results," she says.

In recent years, the broadcast networks have survived a writers strike and new ratings systems that take into account delayed viewing. But ad watcher and researcher Brad Adgate wonders how the networks can pull through the economic downturn, which is expected to slash 10% of ad spending this year. He expects that revenue from the upfront could be down by as much as 14%, to $7.2 billion, vs. last year.

"Every year it's something," says Adgate, senior vice president of research at Horizon Media. "Somehow, some way, the networks always look good when all is said and done. But maybe the economy is something they can't overcome."

The economy is threatening TV ad sales just as they've been challenged by the rise of online social media and mobile advertising.

For years, networks showcased their new shows, and advertisers lined up to buy into the programming. An early buy typically provides audience guarantees and better prices than advertisers can get when they buy on the fly. If they don't buy in the upfront, they may face higher prices for whatever ad inventory remains in the so-called scatter market.

But advertisers are increasingly turning the tables on the networks and doing the pitching themselves. Rather than hear what great shows the networks have to offer, advertisers present their brand plans and ask networks to come up with ad solutions.

Networks are trying to sell ads for new and old shows. New NBC shows include two medical dramas, Trauma and Mercy. ABC has returning favorites Grey's Anatomy and Desperate Housewives, along with new shows Modern Family, a look at families in 2009, and Flash Forward, a look at the future and what people would do if they know what happens down the road.

Top network CBS picked up Medium from NBC and has new shows including The Good Wife, with Julianna Margulies assuming family responsibilities after her husband's sex scandal, and a new addition to the NCIS franchise, NCIS: Los Angeles.

For the first time, Pepsi-Cola marketers reached out to TV networks, digital media and print to pitch brand needs in meetings in New York recently. After a 45-minute presentation, brand teams fielded questions for an hour from the media buyers and planners. The goal: to have media folks come up with creative plans for Pepsi brands based on their content and programming.

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