Broadcast Spot Pricing Continues to Creep Up

Average :30 network prime time increased 3 percent in 2011

The price of a 30-second advertisement on network prime time increased at a 3 percent rate in 2011, as strong demand helped push the average unit cost to just under $110,000 a pop.

Per analysis by the New York-based independent agency TargetCast tcm, rates were highest in the second quarter of 2011, when the average :30 cost $127,291, marking a 2 percent increase versus the year-ago period.

As one might well expect, rates were at their lowest in the quarter coinciding with summer repeats and competition series. According to TargetCast, the average Q3 spot cost was $82,951, up 4 percent from summer 2010.

After the Q3 uptick, growth began to peter out again in the fourth quarter, with broadcasters commanding an average rate of $116,122 per :30—a 2 percent increase year over year. TargetCast arrives at its estimates by way of SQAD Inc’s NetCosts service, which compiles data from media agencies and in-house buying systems.

On the year, Fox boasted the highest average unit cost ($180,844), followed by CBS ($106,351), ABC ($105,885) and NBC ($74,758). Top-rated among adults 18-49, Fox commanded the biggest rates in all four quarters.

Fox and NBC fetch the highest prices for a single program in American Idol and Sunday Night Football, respectively. Inventory on both platforms can cost as much as $500,000 per spot. Meanwhile, the greatest bargains can be found on Saturday night when HUT levels are at their lowest. According to buyers, a :30 in NBC’s three-hour block of encore programming averages around $25,000.

Quarter-to-quarter broadcast pricing has been flat-to-up since Q2 2010. Prior to that, the recession and increased pressure from ad-supported cable helped drive costs down. In Q1 2010, rates fell 10 percent to $104,051.

Gary Carr, svp, executive director of national broadcast, TargetCast, said that while the scatter market has softened, much of the impact on client demand can be chalked up to the relatively high sellout levels in the 2011-12 upfront.

“The robust demand for television, combined with a somewhat slower rating decline, drove unit prices and CPMs higher [in 2011],” Carr said.  

While the Big Four put up modest gains, the high-end cable networks enjoyed a significant increase in unit costs. The average rate for 30 seconds of airtime on a top-15 cable net last year grew 10 percent to $11,884.

ESPN led all cable outlets with an average prime-time spot cost of $34,826, maxing out in the fourth quarter with a rate of just under $60,000 a pop. Naturally, the last three months of the calendar year coincide with football season. According to industry estimates, a 30-second spot on Monday Night Football cost just north of $300,000 during the 2011 NFL campaign.