Ratings shift shuffles the upfront landscape

As the annual ad space mating ritual in the world's most crowded and influential kids TV market draws nearer, this year's U.S. kids upfront is falling into step with the events of the last two years. Media buyers and network execs...
March 1, 2000

As the annual ad space mating ritual in the world’s most crowded and influential kids TV market draws nearer, this year’s U.S. kids upfront is falling into step with the events of the last two years. Media buyers and network execs forecast the upfront will likely break next month. Ad spending is expected to be in line with the past couple of years, and buyers are saying it’s poised to be another buyer’s market. Still, an eye-popping 200% ratings increase at Kids’ WB! (kids ages two to 11, Monday to Friday daytime) has shaken up the playing field, and the Internet is changing the landscape as it gains more attention from networks as a way to enhance kid media offerings.

As they prepare to enter negotiations with networks, buyers are evaluating kidcasters’ performance over the last year. ‘The only thing that’s really hot right now, if you want to call it hot, is Kids’ WB!, and that’s because of Pokémon,’ says Gary Carr, senior VP and group director of national broadcast at Western Initiative Media. ‘Cartoon Network is growing again, but its growth rate has slowed a bit,’ and Nick is ‘still pretty well entrenched.’ TN Media’s senior VP/director national broadcast, Larry Blasius, says Fox Kids is ‘still delivering decent numbers, but not necessarily in the same measures it has in past years, ABC as well.’ Fox Family Channel is ‘in many ways still a question mark,’ and syndication ‘has been falling by the wayside.’

Of all the gains and losses over the last year, Kids’ WB!’s swift upsurge is the most dramatic. The network saw a 2.5 increase in Saturday morning Neilsen ratings and a 1.6 jump in weekday daytime ratings among kids ages two to 11 in fourth quarter 1999 over the same period in 1998, unseating Nickelodeon, which was the leading kidcaster in Saturday morning and weekday ratings in Q4 1998. Pokémon led the charge, ranking first, second, fifth and sixth in individual kids program ratings among kids ages two to 11 for Q4 1999.

Jed Petrick, executive VP of media sales for The WB, is obviously pleased at the difference a year can make. The past year has ‘far and away’ been Kids’ WB!’s best yet in ratings growth, he says. He credits Pokémon, running 12 times a week, as well as Batman Beyond, but says ‘many kids found the network and our shows for the first time,’ drawing more viewers to other shows on its schedule as well. (Men in Black also placed in the top 10 individual kids program ratings for fourth quarter 1999). With the hiring of Donna Friedman to run Kids’ WB! in January 1999, the appointment of Susanne Daniels to entertainment president of the parent network in December 1998, and the ensuing growth of Kids’ WB!’s scheduling and programming team, ‘we’ve given it the kind of attention to detail that we were never able to give Kids’ WB! before,’ Petrick says. The performance turnaround has led to ‘great demand all year long in the scatter market,’ he says, adding ‘we’ve never had scatter activity like this.’

Petrick admits that Kids’ WB! would be hard-pressed to repeat the past year’s level of growth in the coming year, but says there is still room for ratings to rise. Next season will be the first full schedule developed by Friedman and her team. For next fall, Friedman says the network is sticking to its formula of ‘high action, high adventure, humor and heart.’ Following this month’s debut of Max Steel, new series from producers including Nelvana, Sony Wonder and Sony Pictures Family Entertainment will roll out, with new and returning programs from Warner Bros. Television Animation remaining ‘a significant part’ of the lineup. Friedman adds that Pokémon, with 52 new half hours in the wings, will continue to be ‘an important part of our schedule.’ In Japan, girls took longer to get into Pokémon, says Petrick, and if that holds true for the U.S., it could push the show’s growing girl numbers higher, which he hopes would bring girls to other Kids’ WB! programs too. ‘You’ll probably find us to be a little more aggressive in the promotional area next year,’ says Petrick, resulting in bigger and more frequent tie-ins with large partners. (In the last year, Kids’ WB! teamed up with such partners as Hasbro and Nintendo for the second-season launch of Pokémon, as well as Sony PlayStation for a holiday sweepstakes promotion.) Ratings could also grow as some of the network’s young stations become more established.

When it comes to possible cost per thousand (CPM) fluctuations this year, ‘the real wild card is what Warner Bros. thinks it can get away with for Pokémon,’ says Matthew Maginley, VP/media director at TSR Advertising, echoing a question on many buyers’ minds. Petrick, who will not discuss CPMs, says only: ‘I expect a substantial increase in demand for Kids’ WB! commercial inventory.’

Still climbing, Cartoon Network has seen ratings jump by 15% on Saturday mornings and 11% on weekdays among kids ages two to 11. ‘Last year was our best ever in ratings and delivery of our whole seven-year history,’ says Betty Cohen, president of Cartoon Network Worldwide. In part, this boost comes from expanding penetration to 61% of total U.S. TV households, up from 54% this time last year. But, says Cohen, the channel’s ratings growth among kids ages six to 11, the demographic advertisers ‘are really interested in,’ has outpaced distribution gains.

‘By summer of 1999, all the way through to the fourth quarter, we hit a critical mass of having enough of our new Cartoon Cartoon original product to really make a difference,’ says Cohen. The channel’s original programs ranked as eight of its top 10 regularly scheduled telecasts among kids ages two to 11 and six to 11 in 1999, and Courage the Cowardly Dog, launched last November, marked Cartoon’s highest-rated original show premiere. Cohen says anime block Toonami has been a ‘powerhouse,’ with ratings for kids ages six to 11 topping out at 2.7 in 1999 for U.S. households subscribing to Cartoon. She adds that consumer products, particularly Powerpuff Girls merch from Warner Bros. Consumer Products, started to really take off last year.

To keep the momentum building, two new originals are in the works. Sheep in the Big City, created by Mo Willems of Curious Pictures, stars a sheep in hiding in New York City. It will kick off in November, followed by a yet-to-be-announced second original, set to launch in second quarter next year. Gundam Wing comes to Toonami this month, and the block will extend to three hours in June with the addition of Tenchi Muyo (see sidebar next page). New episodes of The Powerpuff Girls, Courage the Cowardly Dog and Mike, Lu & Og have been ordered. With a bigger slate of originals produced, the channel can move more of them out of the Friday night block to grow audience in other day parts as well.

‘The kids marketplace is growing in a kind of interesting way,’ says Cohen. ‘The media dollars are growing somewhat, but not a lot. The promotional dollars are growing very quickly. And what we’re recognizing is that success in the kids business is to take your brand and enable people to tie in with you in more ways than just one.’

To that end, Cartoon Network’s Web site is further ramping up its activities this year. In April, a real-time computer-animated Johnny Bravo will begin accepting kids’ requests in the weekly JBVO Show, culminating in the JBVO All-Request Weekend in December. In the summer, two seven-minute Prickles the Cactus shorts will debut-one on-air, the other on-line (see below). Then in September, Cartoon will harness the Toonami block’s alien host for a week-long on-air promo called ‘Toonami: The Intruder,’ an effort designed to drive kids between their TV and computer screens. For next January’s Big Game promotion, which pits Bugs Bunny against Elmer Fudd, spoof sports stats and other updates will be fed to kids on-line as the event unfolds on TV.

What does all of this mean to this year’s upfront? Karl Kuechenmeister, senior VP for animation and syndication with Turner Broadcasting Sales, expects to see higher CPMs and more cross-selling between the channel and its Web site. ‘As people become more aware of how kids not only purchase, but influence purchases, we see money coming our way,’ he says, pointing to such emerging categories as clothing, computers, entertainment and hygiene.

With rocketing ratings at Kids’ WB! and another year of gains at Cartoon, some buyers are speculating that Nickelodeon’s run of two-year deals is reaching its end, but the kidnet doesn’t seem concerned about losing ad spend to the competition.

‘We’ve certainly not seen any kind of erosion and don’t expect to,’ says Sam Moser, senior VP of advertising sales for Nickelodeon, Nick at Nite and TV Land. Nick’s ratings have held steady with Saturday morning and weekday ratings remaining even, and a 3% total-day increase in ratings for kids ages two to 11 in U.S. TV households, 1999 over 1998. Moser attributes the growth to the channel’s expanding stable of proven hits and the new shows that have launched in the last year. The Amanda Show spun off from All That last October, Double Dare 2000 debuted in January, and Nick News Special Edition (kicking off the channel’s ‘Kids Pick the President’ campaign) and Caitlin’s Way both launch this month. Indeed, Nick’s Snick House, Rugrats, Rocket Power, SpongeBob SquarePants and Wild Thornberrys all ranked among the top 10 in individual kids program ratings among kids ages two to 11 in Q4 1999. About losing its Saturday morning lead, Moser responds: ‘Saturday morning is kind of an outdated, frankly, notion of what kids TV is all about,’ pointing out that Nick airs more than 100 hours of programming per week. Buyers also estimate that the channel remains on top among kidcasters in kids gross rating points (GRPs), with roughly half, with Cartoon Network holding the next big chunk.

Moser says the channel is bringing in several new categories of kid advertising this year, including automotive, computers and tourism, and such already active categories as apparel, retail, the Internet, theme parks, software, electronics, personal care, food products and fast food will be expanded upon. ‘The toy business is relatively weak this year,’ he says. ‘However, with all those other advertisers in the marketplace, they are more than making up for one particular category’s woes.’ Nick is entering the upfront with ‘quite a few’ multi-year deals still in place, he says, including a wide-ranging partnership with consumer PC maker Gateway originated last fall, leading to a certain amount of inventory presold. Moser is anticipating higher CPMs this year.

But most buyers say they aren’t seeing an increase in demand that will drive spending above the US$750-million kids upfront market of the last two years. ‘To a large extent, what the [toy manufacturers] do or do not do is going to dictate the strength of the marketplace,’ says TN Media’s Blasius, estimating that spending by toy companies accounts for between 15% and 20% of the total annual spending, and could represent as much as 40% to 50% in the fourth quarter. He adds that there’s nothing in the fast-food or packaged-goods categories that would signal a significant uptick in demand. ‘There doesn’t seem to be any big new categories,’ says Western Initiative’s Carr. For the most part, he says, the scatter market, ‘usually a good indicator of what might be coming,’ has been weak. On the supply side, buyers say overall GRPs appear to be stable or may even have increased.

At Fox Family Worldwide, president of advertising sales Rick Sirvaitis is satisfied with Fox Kids’ performance given the onslaught from Kids’ WB!’s Pokémon. ‘Fox [Kids] did remarkably well against very strong competition that really hit at its core audience [of boys ages six to 11],’ he says. This year, the network lost its fourth quarter 1998 lead among boys ages two to 11 on Saturday mornings and weekdays to Kids’ WB! But among all kids ages two to 11, while Fox Kids saw ratings drop 17% on Saturday mornings, ratings rose 6% on weekdays. Digimon: Digital Monsters is picking up steam, NASCAR Racers and Power Rangers Lightspeed Rescue hit the airwaves last month, and the network plans to unveil several new shows for next season, keeping with its action-adventure and prankster comedy positioning, says Sirvaitis, all of which should help to grow ratings.

Fox Family Channel, now in its second season, also saw mixed ratings. On Saturday morning, the channel’s ratings among kids two to 11 jumped 50% up to 0.6, but weekday ratings dropped from 0.3 to 0.2, a drop the network could ill afford. Sirvaitis says the channel’s strongest blocks have proven to be the Monday to Friday 3 p.m. to 6 p.m. block, with shows such as Angela Anaconda, The Kids from Room 402 and Big Wolf on Campus, as well as music-oriented, more girl-skewing Saturdays, with S Club 7, Fox Family Countdown and Great Pretenders. Anime-driven Sundays, featuring Digimon and Monster Rancher, are also strong. For next year, says Sirvaitis, ‘we’re going to expand on things that are working,’ including reupping such shows as Big Wolf, Great Pretenders, Angela and Room 402, and introducing new fare, including more anime.

Developing the Web presence of all the services is also in the works. Digital boyzchannel and girlzchannel, launched last October, are not ad-supported, but their Web sites are open to advertising. The company is looking to develop new business in the kids fashion and cosmetics categories.

Like Fox’s Sirvaitis, Jonathan Barzilay, senior VP and GM of ABC’s children’s programming, is taking the network’s ratings decline (a drop of 19%) in stride. Despite the slip, the network is still tied for third on Saturday mornings, and Barzilay says he is ‘encouraged by how popular our programming has continued to be even in the face of this Pokémon phenomenon.’ Animated series The Weekenders, centering around the weekend adventures of four kids, debuted as part of Disney’s One Saturday Morning late last month, ‘an opportune time to refresh the block,’ says Barzilay. He’s confident that ABC continues to offer advertisers the advantages of a large reach and a close to even boy/girl split. ABC is planning several new shows for next fall, and developing its Web presence will continue to be a focus.

Besides, sales for the Disney block may find strength in numbers. Buyers say this year Disney is looking to offer one-stop shopping for ad space across all kid outlets, including Radio Disney, Disney’s One Too, Disney’s One Saturday Morning, Toon Disney, the Disney Web sites and ABC’s prime-time kid-friendly programming. ABC senior VP of network sales Daniel Barnathan is said to be the point man for multioutlet packages, but the network would not confirm at press time.

Of the nets, CBS was struck the largest blow this year, with ratings for its three-hour, all-Nelvana-produced block of kids shows falling 29%. With Saturday morning being the only time the network targets kids and few other younger-skewing programs on the sked, CBS lacks windows to promote its kids lineup, says Tom Horner, senior VP media services at Active International.

Thanks to the pending CBS-Viacom merger though, it looks like Viacom-owned Nickelodeon will be coming to the rescue. Sources say that the Nelvana block will be replaced with a branded Nick Jr. block as early as this fall. As of press time, the line-up had not been announced, but it is expected that popular Nick Jr. shows such as Blue’s Clues and Nelvana’s Little Bear could continue to air weekdays on Nickelodeon as well as running Saturday mornings on CBS. Without confirming the move, Nick’s Moser did say that any possible changes are positive because the two networks will be part of the same company.

Given the trend toward cable viewing, the fourth quarter 1999 lead garnered by Kids’ WB! represents more than just a coup for the network, it represents the first time in years that broadcast in general has upped its share of the kid market. In fourth quarter 1999, 18% of the 6.24 hours per week that kids ages two to 11 spent watching kids programs were on broadcast television, up from 14% in fourth quarter 1998. Meanwhile, syndication fell to below 2% from 5%. Cable still accounts for the lion’s share, dropping only slightly to 80% from 82%. ‘But at the end of the day, it’s all about programming for kids,’ says Susan Morgenstein, group director at Optimum Media. ‘It’s figuring out what’s hot, getting it out there first.’ Kids don’t know if they’re watching broadcast, cable or syndication, she adds, and ‘they don’t care. They’re just like `bring it on.”

Also in the broader picture of kids TV, networks are testing on-line waters more and more as they try to figure out how to integrate Web offshoots with existing media offerings. ‘So many kids are going on-line anyway, you want to be able to capture them in both places,’ says Cartoon Network’s Cohen. Plus, she says, ‘the ability to prove that you can drive people [between the network and the Web site] is a very valuable thing.’ But Active International’s Horner says he hasn’t yet seen as many advertising dollars moving on-line as he expected by this time. In part, that’s because the medium doesn’t yet universally deliver an experience in terms of animation, music and other visual and audio components that’s comparable to a 30-second TV commercial: ‘I think you need a different type of commercial format for the Internet before it will siphon off significant dollars [from traditional media],’ he says. ‘And that will probably happen sooner than we can believe.’

Nielsen ratings source: TN Media’s Kids 4th Quarter Review, published in January 2000

Tenchi Muyo & Prickles hit Cartoon

Anime series Tenchi Muyo will make its U.S. debut on Cartoon Network June 5, airing at 5:30 p.m. Monday to Friday as part of the channel’s Toonami block. Produced by AIC in Japan and distributed in the U.S. by Pioneer, the series stars Tenchi Masaki, a high school boy who inadvertently releases a demon from a shrine in the mountains. Cartoon has acquired 66 half-hour episodes.

Prickles the Cactus will follow, sprouting on air and on-line at this summer. The well-intentioned but somewhat clumsy cactus will launch in two separate shorts (one for each medium), both created by Denis Morella, creative director at Curious Pictures’ West Coast studio. In the seven-minute traditional cel-animated short for the What a Cartoon! show, Prickles (who runs around on roots that serve as her feet) is in search of water for her human dad and younger brother, while facing the conundrum that she’s allergic to water, which makes her swell. The story line of the Web Premiere Toon was being developed at press time, and kids will be able to interact with the story. Morella has previously worked with Cartoon Network as a director of two spots that appeared as part of the channel’s ‘Animate Your World’ PSA project in 1998.

Kid viewing up in `99

In a turn from last year’s declines, kids television usage and hours spent watching TV have both increased this year, according to TN Media’s Kids 4th Quarter Review. Television usage (defined as the percentage of people within a demographic using television in a specific daypart-also referred to as Persons Using Television) rose to 12.2 among kids ages two to 11 on a total-day basis in fourth quarter 1999 from 11.9 in fourth quarter 1998, and virtually every daypart saw an increase. As well, the amount of time kids ages two to 11 spent watching TV jumped over the same period, to an average of 14.6 hours (for kids and non-kids programming) per week from 13.8 hours. Still, kids television usage in fourth quarter 1999 was not as high as the level in fourth quarter 1996, when the figure was 12.6 among kids ages two to 11 on a total-day basis.

A decline in the viewing of non-kid programming was mainly responsible for driving television usage down over the past few years. In fourth quarter 1999, kids ages two to 11 spent an average of 6.2 hours per week watching kids programming and 8.3 hours watching non-kids programming, compared to 5.8 hours watching kids programming and 9.2 hours watching non-kids programming in fourth quarter 1996.

Cartoon lets Boomerang fly

This April Fools’ Day will see the launch of Cartoon’s new Hanna-Barbera-heavy Boomerang service for younger kids and nostalgic boomers. The digital subscription service headed by Cartoon senior VP Mark Norman will feature three-hour themed blocks of programming devoted to selected classic characters mixed with two-packs of half-hour series such as The Smurfs. Saturdays will be devoted to nostalgic toons from a particular year in the past, and Sundays will focus on action-adventure.

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