Reinventing Kids’ Nets for a New Media Generation

As Another Upfront advertising market approaches, the kids’ cable networks are dealing with the changing TV environment in a big way.

Nickelodeon, Cartoon Network and Disney Media are creating more content as the programming becomes more competitive, and they’re putting that content on more platforms in search of that new post-millennial generation of young viewers.

On March 6, Nickelodeon will hold its upfront presentation for media buyers at New York’s Palace Theatre, where SpongeBob SquarePants: The Broadway Musical currently runs. Cyma Zarghami, president of Nickelodeon and Viacom Media Networks Kids & Family Group, said the venue is illustrative of how the network and its content are being reinvented.

Nickelodeon is the leader in the kids’ TV category, but traditional ratings are down as kids entertain themselves with video-on-demand, YouTube, games and whatever else they can find on digital devices.

“What we do is we reinvent ourselves every couple of years as kids outgrow Nickelodeon and another generation of kids come in,” Zarghami said. “So reinvention is in our DNA.”

Added Disney/ABC Television president of ad sales Rita Ferro: “The transformation that’s happening in the world of television, this is where you see it all first. And you see it all earlier than everywhere else. And you’re also more limited and restricted in terms of how you address some of that in the space of measurement and data.”

Nickelodeon is producing more programming than ever before and creating digital and social content for kids and their parents. It is also doing more virtual reality, augmented reality, eSports, consumer products and live events like the upcoming Slimefest.

“The good news about us is we’ve proven time and again that with great IP at the center, we can go anywhere,” Zarghami said. “So we feel pretty well prepared and in a great position to be able to adapt to how the landscape is changing.”

Nickelodeon is getting advertisers to follow along from platform to platform using an “all for one” strategy, said Viacom ad sales head Sean Moran. He noted that Nickelodeon’s VOD plays are up 13% and video streams are up 20%.

“When you come on board with Nickelodeon, you’re going to be part of a deal that’s going across every platform, and that’s the way it’s being served up,” Moran said.

But Jason Maltby, executive director of national video investment at media agency Mindshare, said that while the networks’ online efforts help, ad dollars are being shifted from TV because the solution to audience fragmentation isn’t as simple as shifting 22-minute episodes to a full-episode player.

“You know that kids are online,” Maltby said. “You know they’re using multiple screens. They like to play a lot of games. You know that they are consuming vast amounts of user-generated content. But you don’t always have measurement you’re comfortable with and increasingly you’re going to have concerns about brand safety.”

While lower ratings have put upward pressure on pricing, “I don’t think [kids’ TV] is a growth market. If anything it’s probably plateaued or has started to decline,” he said.

Viacom’s Moran, speaking from Toy Fair in New York, said he sees the kids’ market as pretty healthy. Food marketers such as Dannon, Milk Life and Bel Group cheese have healthy eating initiatives and bigger companies such as Kellogg’s and Campbell Soup are recommitting to the kids market, he said.

On top of that, 25% of Nickelodeon advertisers are nonendemic, looking to reach parents watching with their children.

Christine Miller, president and general manager of Turner’s Cartoon Network, Adult Swim and Boomerang, said Cartoon is seeing audience growth on mobile, VOD and connected devices and is developing programming with those platforms in mind.

“That’s really the world we’re living in and until measurement catches up, we can’t slow down,” Miller said.

For example, Cartoon last year launched its series OK K.O.! Let’s Be Heroes on a gaming platform. Uni-kitty! is based on a character from The Lego Movie. And Teen Titans Go! will be coming to theaters this summer.

Other new shows coming up, such as Apple and Onion, Craig of the Creek and Summer Camp Island, get sneak peek online views before appearing on the networks.

“It’s the most robust content play that we’ve had in a few year and it’s diverse both in the content we’re creating and the creators,” Miller said. As online sites and streaming services jump into the kids category, more programming than ever is being created.

“I still think that quality storytelling and real world-building and character-building gets rewarded and breaks through and that’s what we’ve seen to date,” she said.

Disney/ABC is holding upfront meetings with advertisers at Walt Disney World this week and will be talking about how to connect with kids and their families not just through Disney Channel and Disney Junior — which are sponsored but commercial-free — and the ad-supported Disney XD, but across the whole Disney portfolio.

After the relaunch of DuckTales, sponsor Aflac’s spokes-duck was featured watching the show during a customized segment on ABC’s Good Morning America.

Toons for Our Times

Animation remains key for Disney, with upcoming series including Big City Greens and Amphibia among the entries on Disney Channel’s slate.

But Disney is also putting material together for the Disney Digital Network and creating shows with Facebook, including Club Mickey Mouse.

“It’s going to be an interesting marketplace,” Ferro said. Marketers are looking to move fast to take advantage of trends that come and go quickly. They’re seeing that licensing products are big movers for them, she said.

Working with a company such as Disney can give marketers broad reach and the ability to tell stories as part of their advertising messages using new technologies and new platforms.

“When you think about video there is no better place than television to be able to tell that story — and when I say television, I’m using the word elastically,” Ferro said. “I’m not talking about the screen, I’m talking about the content.”

Jon Lafayette

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.