Writers' Strike: Media Snowball Effect
Well it’s winter time now, so after work I like to go home, eat dinner and then curl up on the couch with a blanket, a cup of warm apple cider and, of course, my remote! I’ve been a total couch potato lately, but how can you blame me? With great shows and new episodes of Dancing with the Stars, Grey’s Anatomy, Family Guy, House and, of course, Heroes, I can’t see myself doing anything else after 7p.m. Yes, it doesn’t do anything for my figure, but I’m nice and relaxed every evening!
The problem that’s knocking on my door, and Hollywood’s, is the snowball effect of the writers’ strike. As a TV consumer by night, I haven’t really thought about the strike’s repercussions on my TV viewing habits. But as a media director by day, I realize I (and all media buyers) need to wake up! Very soon our favorite TV shows to watch - and buy - could be gone for awhile. Then what?
As a media buyer, how will I reach my target demographics who normally watch the big ticket prime time shows? Will our media plans for 2008 be as successful as we had hoped? What are the implications for other media? Will their prices go up because of increased supply and demand? As a TV consumer, will I be forced to change my TV viewing habits?
Network executives, big advertisers and their media buyers are very worried about the snowball effect being caused by the writers’ strike -as they should be. they should be. According to Time magazine, the last writers’ strike in 1988 cost the industry an estimated $500 million. This time around, the costs could be even higher. As 2007 comes to a close, media buyers in major markets are sure to begin asking the networks for rebates on their third quarter buys since the writers’ negotiations haven’t been completed and the decline in ratings will likely continue. Mediaweek reports that network executives say there is enough new written material for scripted shows to carry the industry through February sweeps. However, if buyers start asking for rebates, adjustments or make goods from the first quarter avails, this could diminish advertising inventories and increase costs for what is available. Already, networks had set aside contingency make-goods for the 2007 upfront deals. With the possibility of more make-goods and cash back for 2008, the networks could be facing a cash and spot availability shortage during the upfronts for 2008.
It’s also been said that with the few remaining new scripts, networks are planning on airing reruns through December and January, accompanied by plenty of reality TV programming to pull through the end of the season. Can you imagine reruns and reality TV being the staple of our TV viewing options? Ugh. Not only is that a boring combo, but how will I reach the large percentage of viewers who watch new scripted shows like Grey’s Anatomy and Desperate Housewives? It’s hard to believe that these viewers will be motivated to watch reality shows and reruns. If not, the make-goods and cash back situation could really make that snowball even bigger. With the launch of the newest seasons of hit reality shows like American Idol, Dancing With the Stars, Dance Wars and a few others, some buyers and networks believe even more viewers will tune into these shows since there is nothing else to watch. I’m not sure I share their optimism.
Time also provided a list of alternative solutions that Hollywood is considering to remedy the situation. These ideas include more celebrity interviews and fewer monologues on late night TV talk shows; airing British versions of popular shows like The Office and Desperate Housewives; and providing more opportunities for new and struggling shows to find an audience and, hopefully, generate buzz and numbers. Other options involve assigning more foreign writers to US TV projects; and airing more documentaries.
Cable TV could end up being the hero to this situation. According to media executives quoted in Mediaweek, cable has the ability to air original episodes of their new shows that many network viewers haven’t seen yet. Some experts are predicting that viewers will turn more to cable, and network ratings will continue to decline. Many buyers are wondering whether or not cable will exploit the situation by hiking up rates. Many cable executives, quoted in Mediaweek, are saying no. However I believe only time will truly tell.
So, as I look forward to 2008, my inclination is to transfer some of our clients’ TV dollars, as appropriate to the target audience, to other media options like cable, radio, billboards and Internet advertising and print. (Do you think that people will actually start reading more when there is less exciting TV shows available? It’s an intriguing question.)
Obviously, this event is something no media buyer planned for. Any change to the TV audience numbers is likely to have a serious impact on even the best laid media plans. We’ll be watching – or not.
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