Hallmark Crowns a Strong Upfront Market

As a strong upfront wraps up, one of the smallest cable programmers might have gotten the biggest greeting from advertisers.

Crown Media, which runs the Hallmark Channels, posted a double-digit increase in dollar volume while at the same time holding out for — and getting — double-digit increases in prices.

The warm reception came even though its upfront dinner in March was snowed out.

“Despite the snowstorm, I think our message got through,” Ed Georger, Crown’s executive vice president for ad sales, said. Crown’s upfront sales “reflect that our advertising partners believe in what we’re doing.”

The upfront’s results can be hard to gauge. Most networks won’t talk about ad sales, except on earnings calls. Even when sales executives like Georger speak on the record, they rarely offer precise numbers.

Turning Up the Volume

Cable-network volume rose by 4.7% to $11.1 billion, per preliminary estimates from Market Dynamics. The price to reach adults in 30-second spots rose 9.7% to a $17.49 cost per thousand viewers (CPM).

“I think linear television still continues to deliver for a lot of marketers,” Georger said. “Perhaps it’s got something to do with brand safety or some of the cautionary tales that we’ve heard about some of the other platforms.”

Unlike most networks, Crown Media’s Hallmark Channel and Hallmark Movies & Mysteries are growing their viewership, giving them more ratings points to sell. It has also been increasing its original programming, with more than 100 original movies on its slate in addition to its three series.

Hallmark Channel’s strategy of programming toward the holidays helps make it the top-rated cable channel during the fourth quarter, when advertisers are seeking Christmas season sales. It also provides hooks for advertisers who want to make their commercial messages relevant around Valentine’s Day, Mother’s Day or wedding season in June.

For its daytime show, Home & Family, the house on the Universal Studios lot that serves as a set is being renovated, and several advertisers have signed on as sponsors. “We’ve also created a Dream Holiday Home Decorating Contest,” Georger said. “Those are a couple of new opportunities that brought value to the marketplace.”

Even with the double-digit increases in prices, Georger said the Hallmark Channels are still a bargain relative to other networks. “We are still undervalued in the market, but it’s great to see our partners recognizing our success and rewarding us, not only incumbent business but some new categories as well,” he said.

Fresh advertiser categories on Hallmark include theatrical films, imported autos and quick service restaurants.

Georger didn’t think that Crown Media’s lack of scale was a problem in the upfront. “We pride ourselves on being very nimble,” he said. “Bill Abbott is right down the hall, and he’s our CEO who used to be in ad sales. We can work through our company very quickly.

“Bigger companies have a lot of goals, strategies and objectives, and some of them conflict,” he added. “We were complimented often on the process of negotiating with Crown Media, this year in particular.”

With its rising ratings, Crown Media didn’t push for new metrics or the fancy data being pushed by programmers like Turner.

But according to people familiar with the situation, Turner was able to achieve its objective of getting more of its advertising clients to put money into campaigns based on data-driven target audiences instead of the traditional age and gender demographics.

Targeted Spending Rises

Turner clients committed to spending five times as much on target audience-based campaigns in this year’s upfront, compared with a year ago.

Clients also increased their commitments to Turner’s digital platforms, including video-on-demand and over-the-top.

Turner parent Time Warner was recently acquired by AT&T, which has ambitious plans to use the programmer’s data to boost the yield on Turner’s ads.

From a traditional point of view, Turner got higher prices for advertising, garnering low double-digit gains, and an increase in dollar volume in the low-to-mid-single digits.

On its earnings call last week, AMC said it collected high single-digit price increases in its upfront sales.

“We saw healthy demand and healthy volume across all of our networks,” chief operating officer Ed Carroll said. He noted that this year’s market moved quickly for AMC.

“It was as fast as any in recent memory and I think a contributing factor to that was an eagerness among advertisers to get their money down next to quality content,” Carroll said.

Advertisers were also taking advantage of AMC’s audience targeting system, which clients in the auto, quick-service restaurant and movie businesses signed up for during the upfront. “We are finding that our proprietary advanced data platform is effective for us, particularly in increasing volume among our highest-CPM advertisers,” he said.

Jon has been business editor of Broadcasting+Cable since 2010. He focuses on revenue-generating activities, including advertising and distribution, as well as executive intrigue and merger and acquisition activity. Just about any story is fair game, if a dollar sign can make its way into the article. Before B+C, Jon covered the industry for TVWeek, Cable World, Electronic Media, Advertising Age and The New York Post. A native New Yorker, Jon is hiding in plain sight in the suburbs of Chicago.