Archive for August, 2015


Consumers rang in the New Year full of optimism, but with nearly seven months of 2015 under their belt, this sunny outlook has faded a bit. The latest IRI MarketPulse survey found that shopper sentiment dropped in Q2 2015, but it is consistent with the dip typically seen during Q2 in past years. The good news is that sentiment is higher in Q2 2015 compared with Q2 2014, so consumers are feeling better about the direction of the economy and their own financial health, but they do remain cautious.

“That New Year’s high does give way to reality after a few months, so this decline isn’t surprising,” says Susan Viamari, vice president of Thought Leadership, IRI. She says consumers are “cautiously optimistic,” but still focused on value.

Constructed against a benchmark of 100 in Q1 2011, IRI’s Shopper Sentiment Index dropped to 123 in Q2 2015 compared with 138 in Q1; however, it does remain higher than the Q2 2014 index, which came in at 117. Overall, 24% of consumers feel their financial situation has improved during the past year, and 24% feel their situation remains unchanged. In addition, 23% expect improvement in the coming six months, which is consistent across all groups. For instance, 22% of Millennials, 27% of those age 35-54 and 21% of Baby Boomers expect this positive progression to continue throughout the remaining months of 2015.

Consumers have been cautious about opening their wallets for the past several years, and IRI says this isn’t going to change anytime soon. In fact, they are still doing their homework and planning what to purchase before they even step out of the house: 64% are making a list prior to going to the store; 52% are choosing the store they will shop at because it offers the lowest prices on needed items; and 45% are stocking up on certain items when they are on sale.

The survey found that consumers love to get a good deal, but they are even more focused on value. In fact, less than 50% of the shopping basket is purchased based on deals for two-thirds of shoppers. Since value means different things to different people, it’s absolutely critical for manufacturers and retailers to get the base price for products right. 83% will choose brands based on price in the coming year; 80% will choose brands based on previous trust/usage; and 58% will choose brands based on household requests.

“Retailers and manufacturers must work together to create holistic pricing strategies that underscore the value proposition for consumers, while still supporting their share, margin and growth goals,” said Viamari. But she also admitted that’s not easy to achieve.


It is still very early to predict how many hot Senate and House races there will be next year and just how much more will be spent on a Presidential race with no incumbent, but Elizabeth Wilner of Kantar’s CMAG is out with the early forecast of 2016 election spending on TV. At this point, Wilner says in her latest column for The Cook Political Report, CMAG’s estimate is total political spending of $4.4 billion across broadcast and cable TV.

You might think that the longer the Republican presidential primaries go on without deciding a nominee, the better for television—more candidates with more money to spend. But that’s not necessarily so, says Wilner. Comments from E.W. Scripps VP of sales Michael O’Brien explain that the longer the Republican primary lasts, the longer candidates and their supporting groups are advertising in just one or a few states at a time as opposed to 10 or more states every day. TV needs engagement by the GOP and Democratic nominees-designate early on to sell inventory in general election swing states in Q2 when viewership is high. “If Republican candidates run out the primary until June, we have lost the opportunity to max out revenue” for the quarter, O’Brien says. The absence of Q2 presidential general election advertising could affect the overall total by as much as $100 million or more.

To get to the $4.4 billion estimate, Wilner and her team use methodology developed for CMAG by the University of San Francisco’s Ken Goldstein. The methodology accounts for a range of factors including the number and location of likely competitive congressional races; the number and location of presidential battleground states; the total amount of money likely to be raised and spent in all races, including for governor; the proportion of total spending likely to go to TV; and how that TV ad spending is likely to be split between local and national, broadcast and cable. CMAG figures the first open presidential contest since the Citizens United court ruling could add $500 million to spending—even more if Democratic billionaires turn out to support Hillary Clinton, who is seen as the party’s likely nominee.

“We could see less than $4.4 billion on TV if the GOP primary drags on, or more than $4.4 billion if it wraps up fast. We could see less than $4.4 billion if Democratic billionaires don’t bring their A-game for Clinton, or more than $4.4 billion if they do. We also could see more than $4.4 billion if California produces a juicy slate of ballot initiatives. Overall, we see slightly more upside than downside in this early estimate of 2016 political TV ad spend,” Wilner wrote.

Of that $4.4 billion, she sees $3.3 billion going to local broadcast TV. CMAG is assuming $800 million in local cable TV ad spending for a share of 20% of all local buys. Wilner says local cable industry reps themselves are projecting 30%; but CMAG’s survey of several heads of large media-buying shops yielded estimates of 18-24%. “Despite the size of the battleground seemingly arguing for local buying, we expect to see more national [broadcast] network and cable advertising this time around,” Wilner says, putting the figure at around $300 million.


In an effort to reach cord-cutters and young people who’ve never subscribed to a cable or satellite TV service, Comcast has launched its own over-the-top (OTT) service. “It’s unlike anything we’ve ever offered: no extra device or additional equipment required…or even a TV. And it’s called Stream,” said Matt Strauss, Executive Vice President and General Manager, Video Services for Comcast Cable in TV, in a corporate blog post.

With Stream, Xfinity Internet customers will be able to watch live TV from about a dozen networks, the company said. And while they weren’t all identified, Comcast said the skinny bundle will include “all the major broadcast nets and HBO.” The service includes thousands of on demand movies and shows and also comes with access to TV Everywhere and a cloud DVR.

To get Stream a customer first has to be subscribing to Xfinity Internet—adding Stream is an extra $15 per month. The OTT service will first launch in Boston at the end of the summer, followed by Chicago and Seattle.

“Getting started is easy and doesn’t even require a phone call or a visit from a technician. Xfinity Internet customers can just sign-up online, download our Xfinity TV app and start watching. It’s that simple,” said Strauss. He said the idea was to make ordering the OTT service as simple as buying a song online.

Dish Network led the MVPD charge into OTT earlier this year with the launch of Sling TV. Its basic package of channels, which includes ESPN and more than 20 other cable channels, is priced at $20 per month. But HBO is an additional $15. Sling TV subscribers can buy their Internet access from whomever they choose.

Of course, Comcast has the advantage of owning quite a few networks. It could easily fill out Stream with a number of the NBCUniversal cable networks—such as Bravo, USA, Oxygen, Syfy, NBC Sports Network and NBC Universo—plus HBO and local affiliates of the three Big Four broadcast networks it doesn’t own—ABC, CBS and FOX. No doubt local NBC and Telemundo affiliates will be happy to participate (for a fee) in markets where NBCU doesn’t have O&Os.

Strictly speaking, Comcast is already in the OTT business. Xfinity on Campus allows college students to stream a variety of TV shows and movies, with the subscription cost included in their student housing fee. The success of that service is credited with moving Comcast to offer a direct-pay OTT service.