NETWORK NEWS

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ABC is teaming with the restaurant chain Panda Express to celebrate Chinese New Year in conjunction with a new episode of Fresh Off the Boat airing Tuesday, February 2, at 8:00 pm (ET). Panda Express restaurants across the country will display special branded Fresh Off the Boat Chinese New Year Posters and table tents featuring the stars, the Huang family. In the episode, the Huangs are getting everything in order to celebrate Chinese New Year with their family in Washington, DC, but a mix-up with their plane tickets forces them to spend the holiday in Orlando……Despite the poor ratings to date, Crazy Ex-Girlfriend got praise from The CW President Mark Pedowitz at the winter Television Critics Association gathering in L.A. Will the series starring Rachel Bloom get a second season? Pedowitz said The CW is known for defying the odds and Crazy Ex-Girlfriend has the potential to do the same……ABC is bringing the game show $100,000 Pyramid back to primetime in summer 2016. Michael Strahan will host the 10-episode series featuring hot stars teaming up with players from across the country in the timeless war of words……CBS announced some spring scheduling moves, including the series premiere of Rush Hour on Thursday, March 31, at 10:00 pm (ET) and the updated premiere date for Criminal Minds: Beyond Borders on Wednesday, March 16, at 10:00 pm (ET), which was previously slated for Wednesday, March 2. In addition, Elementary moves to Sundays at 10:00 pm (ET) beginning March 20.

THIRD-PARTY MEASUREMENT IS KEY

The Association of National Advertisers (ANA) is getting tough and demanding transparency from online advertising providers. And since the ANA represents the biggest spenders on advertising that there are, it should get the attention of the digital ad companies. Even the title of the ANA whitepaper makes the issue clear: “The Critical Need for Accredited Third-Party Measurement for Viewability of Digital Advertising.”

“The key issue this addresses is the fact that some large digital media owners do not allow third-party measurement vendors to report viewable ad impressions to their clients,” says ANA Group EVP Bill Duggan in laying out the advertisers’ concerns. “Instead, they rely on internally derived metrics that have not been independently verified. This means marketers must trust the viewability metrics provided by those digital media owners, without any independent verification (i.e., from the Media Rating Council), to determine if their ads performed as contracted.”

An ANA member survey found that an overwhelming 97% of marketers believe that the larger digital media owners should allow their inventory to be measured by a third party. If a digital media owner does not provide third-party measurement, 61% of respondents would shift their spending elsewhere.

ANA members are familiar with Media Rating Council (MRC) accreditation in their dealing with other media—and they want it for digital as well. 65% of respondents very strongly feel that a digital media owner should have its internally derived metrics accredited by the MRC. The vast majority of respondents—90%—said they are not fully confident that their working media dollars in digital platforms are being served in a manner that meets industry viewability standards.

As a result, ANA has issued some major calls to action. First off, ANA says all digital media owners should allow their inventory to be measured for viewability by a third party. Marketers and their agencies, then, should only use third-party ad measurement vendors that have been accredited by the Media Rating Council for current industry-agreed viewability standards.

ANA says it strongly encourages marketers to demand greater transparency and accountability for their digital media investments, support accredited third-party verification, and ensure that includes the measurement of viewable impressions. The ANA, as our readers know, has been working with the 4A’s, representing ad agencies, and IAB, representing digital ad vendors, to gather data for MRC standard-setting in various types of digital advertising.

DOCTORS WANT BAN ON DRUG ADS

The American Medical Association (AMA) has changed its policy and this week voted to ask for an end to Direct-To-Consumer prescription drug advertising on television. It’s a category that Advertising Age says spent $4.8 billion in measured media last year.

A rule change from the Food and Drug Administration in 1997 allowed pharmaceutical companies to use TV advertising for the first time, but doctors were not happy about it at that time, and never fully warmed up to the idea. An AMA spokesperson said this week’s vote “reflects concerns among physicians about the negative impact of commercially driven promotions and the role that marketing costs play in fueling escalating drug prices.” Previously the AMA’s policy had been that as long as the commercials were accurate and educational it had no objection to the use of the medium.

Part of the problem could be that some of the most heavily-advertised drugs are also the most expensive. A recent AARP publication notes that Humira, for example, has a monthly co-pay among Medicare Part D plans available in New York that ranges from $799.97 to $1163.30, so advertising can ignite a consumer demand for a drug that will be not affordable to many people.

Trade group Pharmaceutical Research and Manufacturers of America (PhRMA) of course has a different outlook on the question, saying the ads inform viewers about diseases and treatment options. A spokeswoman for PhRMA said “Providing scientifically accurate information to patients so that they are better informed about their health care and treatment options is the goal of Direct-To-Consumer advertising. Research shows that accurate information about disease and treatment options makes patients and doctors better partners.”

Putting television advertising for DTC drugs in perspective, the Washington Post has reported that television took 61.6% of the dollars pharma companies spent in all media last year (up from 52.6% three years ago). But the dollars spent on measured media still are just a fraction of drugmakers’ total marketing. In 2012, when the companies spent $3.5 billion in DTC advertising, they also spent $24 billion directly promoting drugs to doctors.

ADVERTISER NEWS

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General Motors will be the first U.S. manufacturer to import a Chinese-made vehicle, the Buick Envision SUV that will go on sale early next year. The Wall Street Journal says GM and the UAW discussed the idea in their recent contract negotiations and “appear to have come to an understanding.” In a different note about GM and the union, Automotive News reports the two have re-started contract negotiations to work out new details that will satisfy skilledtrade workers, who voted down the proposed new contract, so the old contract has been extended again to November 20……Jeep will introduce the Jeep Wave program for some of its higherprofit models, including amenities such as free routine maintenance, complimentary loaners, discounts on accessories and road trip interruption insurance coverage…… Sears will give members of its Shop Your Way program a Members Private Night on 11/22 with access to Black Friday doorbusters……Even the high end of the department store business is looking a little lethargic: Nordstrom quarterly same-store sales were up just 0.9%, although it’s still projecting a 2.5-3.0% comp gain for the holiday season. It opened just two new domestic full-line stores during the quarter, but 16 new Nordstrom Rack units……The auto aftermarket had been doing very well, but Advance Auto Parts’ same store sales were up just 0.5% for the quarter that ended on 10/10. Advance plans to close about 30 stores before the end of the year, but that will still leave them with more than 5,200 in operation……Conn’s has had some tough profit reports because to prior credit policies that proved to be too lenient, but it still has a very aggressive outlook about expansion. Currently opening its 100th store, it’s opening 17-18 this fiscal year, 20-25 for the following two years and even more afterwards, with an eventual goal of 500 locations……KFC will test home delivery, starting in the L.A. and San Francisco markets, using DoorDash (the same service being sued by In-NOut Burger for unauthorized delivery). A delivery fee of $5- $7 will be added depending on the customer’s location…… El Pollo Loco franchisees reported a 1.1% same-store sales increase for the latest quarter, but company-owned locations were flat due to an almost 2% drop in total traffic, causing an 81.9% decline in corporate profit……We noted last week that On The Move had targeted Florida for heavy c-store expansion, but it looks like there will be plenty of competition. 7-Eleven has just purchased 101 stations from Biscayne Petroleum and sibling Everglades Petroleum and Wawa Inc. now plans to add 120 stores there by 2022. Wawa notes many people in Florida are transplants from its Northeast territory who are familiar with its brand.

READY TO SPEND ON ‘THINGS THAT MATTER’

Millennials make up nearly a quarter of the population and already spend about $220 billion per year in the U.S. Nielsen says they fascinate marketers and retailers—but that capturing Millennial dollars has proven challenging. In the U.S., this generation has different interests than their predecessors, and marketers and retailers must pay attention to the unique shopping habits of this young generation.

Millennials are young and optimistic about their financial futures. According to the Q2 Nielsen Consumer Confidence report, roughly 70% of Millennials indicate their personal finances will be either good or excellent in the next year. However, having gone through the Great Recession at a young age, they are caution about finances and 55% still feel like the U.S. is in an economic recession.

With limited money to spend, Millennials are savvy shoppers by necessity. Avid researchers, 42% of them check at least four sources when trying to decide on a purchase, according to Edelman Digital. About a third make purchases only when they have a coupon or promotional code. And roughly 40% buy previously used items online to save money.

While economic struggles are a reality for many Millennials, one subset is thriving. Roughly 27% of this generation qualifies as upscale Millennials, earning more than $75,000 per year. The median liquid wealth value (income producing assets; IPA) for upscale Millennials is $157,500, more than 11 times the median IPA of their generation as a whole. Despite having more money to spend, upscale Millennials are deal-lovers as well. Roughly 43% use coupons at least once month.

Despite their love of a deal, Nielsen says all Millennials are willing to spend on things that matter to them. As a generation defined by their use of technology, the majority of Millennials aren’t willing to delay upgrading their PCs or mobile devices to save money. And while Millennials are spending less on clothes to save money, 35% still make apparel purchases with their extra cash.

About 92% of Millennials own a smartphone, compared with 76% of Baby Boomers. Because technology is an integral part of their lives, it’s a key component of their shopping experience. Roughly 19% of Millennials and 31% of upscale Millennials spent over $1,000 online in the past year. The majority (66%) use the Internet to purchase hard-to-find items. Roughly 70% of upscale Millennials scour the Internet for hard-to-find items.

NETWORK NEWS

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Known to many as the “mean judge” on American Idol and The X-Factor, both of which aired on FOX, Simon Cowell is returning to American TV next summer as a judge on NBC’s season 11 of America’s Got Talent. Cowell created the “Got Talent” format and has been executive producer of the U.S. version……It’s beginning to look a lot like Christmas with ABC’s holiday decorating competition series The Great Christmas Light Fight, premiering Monday, December 7, at 8:00 pm (ET). The third season will feature new celebrity judges: Carter Oosterhouse of HGTV’s Million Dollar Rooms and Taniya Nayak of Food Network’s Restaurant Impossible. The Great Christmas Light Fight features families and neighborhoods from across America decorating their homes to the extreme for Christmas with a total of $300,000 in prizes……TV’s Funniest Animated Stars: A Paley Center for Media Special is set to air Monday, December 7, at 8:00 pm (ET) on FOX. The special will profile Mickey Mouse, Bugs Bunny, Homer Simpson, Bart Simpson, Stewie Griffin, Donald Duck, SpongeBob SquarePants, Scooby-Doo and many more……Nikki M. James has joined the cast of BrainDead, a new comic-thriller set in the world of Washington, D.C. politics, to be broadcast in summer 2016 on CBS. The series comes from Robert and Michelle King, creators and executive producers of The Good Wife. James will play Rochelle, a medical resident whose father died as the result of a mysterious infection.

MOST BENEFIT TO QUICK SERVICE OUTLETS

Breakfast is the only restaurant daypart with sustained visit growth over the last several years, according to The NPD Group. As a result, classic foodservice breakfast fare, like bacon, breakfast sandwiches, and pancakes, are also growing. Case shipments of bacon, eggs, and pancakes from broadline distributors to foodservice outlets have increased as have servings of these foods ordered at restaurants and other foodservice outlets. There’s no end in sight to the trend of Americans eating breakfast outside the home—as evidenced by McDonald’s deciding to offer its breakfast menu all day, every day.

Breakfast/morning meal visits grew by 5% in the year ending June 2015 over the same period last year when visits grew by 2%, reports NPD’s CREST ongoing foodservice market research. Quick service restaurants, including retail foodservice, were responsible for most of the visit gains at breakfast. Lunch was up 1% in the period over a 2% decline the prior year and dinner visits were flat. Breakfast sandwiches and bacon, perennially popular grab-and-go breakfast foods, have been growing but so have other not-so-portable foods, like pancakes.

Case shipments of bacon shipped from broadline foodservice distributors to restaurants and other foodservice outlets increased by 7% in the year ending June 2015 compared to year ago, finds NPD’s SupplyTrack, a monthly service that tracks every product shipped from major broadline distributors to foodservice operators. Case shipment of eggs, the food item likely to be found in the middle of a breakfast sandwich, increased by 5% in the period, and case shipments of pancakes shipped to foodservice outlets also increased by 5%.

Bacon servings ordered at restaurants and foodservice outlets increased by 2%, which translated to a servings volume of 1.1 billion, in the year ending June 2015 compared to a year ago when servings increased by 6%. Breakfast sandwich servings increased by 3%, or a total of 3.6 billion servings, over flat growth prior year. Servings of pancakes ordered increased by 7% to 816 million servings in year ending June 2015 over year ago when servings were down by 4%, reports NPD.

“Growth at the breakfast daypart has been good for the industry and also led to an increase in distributor sales within key breakfast operator segments,” says Annie Roberts, vice president of NPD’s SupplyTrack. As breakfast traffic continues to grow, she says competition in the breakfast space will require distributors, manufacturers, and operators to become innovative in providing quality and value at breakfast.

It’s clearly a hot segment—and as the competition increases, advertising is needed for restaurant chains to differentiate themselves from their competition. For TV account executives, it should be a way to bring home the bacon.

FORD JUMPS 23%, INDUSTRY UP OVER 15%

With all of the Labor Day weekend inside the month this year, September was destined to be a strong month for U.S. auto sales. Was it ever! Total sales of cars and light trucks shot up 15.7% from last September to 1.44 million. That put the seasonally adjusted annual rate (SAAR) of sales at 18.2 million—the strongest sale rate since July 2005. Importantly, the factors driving SAAR were very different from 10 years ago, when the Detroit 3 were struggling and offered employee discounts to all comers to move vehicles. Now consumer demand is strong—especially for big-ticket pickups and SUVs, with Kelley Blue Book reporting that the average transactions was $33,730—up 2% from a year ago and 0.5% from August.

Double-digit gains were widespread for September, with four automakers reporting unit sales up well over 20%. One of those was a big, full-line maker: Ford Motor Company sales rose 23.3% to 221,269, driven by sales of pickups (the F-150 is pictured) and SUVs. Sales for the Ford nameplate rose 23.4% and Lincoln 19.6%. The biggest percentage gain of all was for Jaguar Land Rover, up 61.3% to 6,850, with Land Rover up 88.5%, but Jaguar down 12.9%. Mitsubishi surged 35.9% to 7,556 and Subaru was up 27.8% to 53,070.

Truck sales also boosted General Motors, with total sales up 12.5% to 251,310. Truck brand GMC led the way, up 23.8%, with Chevrolet up 10.9%, Cadillac 7.8% and Buick 5.0%. Jeep was the star performer, up 39.8% as total FCA U.S. sales rose 13.2% to 194.068. Ram was up 3.8%, Dodge 2.6% and Fiat 1.1%, while Chrysler was down 5.3%.

Nissan North America was up 18.3% to 121,782, with Infiniti up 30.4% and Nissan 17.3%. Hyundai-Kia gained 17.8% to 113,835, with Kia up 22.6% and Hyundai 14.3%. Toyota Motor Co. sales rose 16.2%, with Scion surging 56.7%, Lexus up 15.8% and Toyota 15.1%. American Honda was up 13.1% to 133,750, with Honda up 14.0% and Acura 6.3%.

The Volkswagen brand was up 0.6% despite its diesel scandal, with total U.S. sales for parent Volkswagen AG up 7.3% to 48,016. Porsche shot up 22.7% and Audi gained 16.2%, while Bentley sales dropped 53.0%. Daimler AG sales rose 6.0% to 32,087, with Mercedes-Benz up 6.0% and Smart 0.3%. BMW Group gained 4.1% to 31,117, with Mini up 4.6%, BMW 4.0% and Rolls-Royce 2.2%.

Volvo had another strong month, up 18.4% to 5,527. Mazda sales rose 6.8% to 25,616.

TrueCar was the first to jump in and raise its 2015 sales forecast by 0.2 million to 17.4 million. That would be an all-time record for U.S. light vehicle sales.

VIDEO ADS MOST TRUSTED ONLINE

The headline from Nielsen for its latest research says “Digital formats are among the most trusted advertising sources despite slow growth.” But if you read down into the data and analysis, you’ll find that it’s not a digital ad format that elicits the most trust among consumers—it’s a traditional media format: television spots. Good old TV advertising is trusted by 63% of the people surveyed in Q1 of this year—and that’s a one percentage point gain from a previous survey in Q1 of 2013. In fact, TV advertising was the only a format to gain in consumer trust over the two-year period.

The best showing for a digital ad format is 48% for online video ads (many of which, we would note, are delivered with TV content)—unchanged from 2013. In fact, several other traditional media ad formats top all of the digital ones in consumer trust: newspaper ads at 60%; magazine ads 58%; billboards 56%; TV program product placements 55%; radio ads 54%; and ads before movies 54%.

By comparison, ads served in search engine results were trusted by 47% of the people surveyed by Nielsen; ads on social networks by 46%; ads on mobile devices 43%; online banner ads 42%; and text ads on mobile phones 36%. Of those, trust of banner ads was flat with two years ago and the others were down slightly.

Nielsen noted that Millennials show the highest levels of trust in 18 of 19 advertising formats/channels—including TV, newspapers and magazines.

2-TIER PAY IS TOP ISSUE IN NEGOTIATIONS

In a move that surprised many observers, the United Autoworkers Union (UAW) has selected Fiat Chrysler Automobiles US (FCA) as the lead company for creating an industry-standard contract—in other words, the strike target if the union and management can’t come to terms. The UAW’s current contracts with FCA, General Motors and Ford were all set to expire at midnight last night. Whether there was to be an immediate strike likely depended on the progress being achieved in negotiations. The Detroit Free Press noted that a tentative deal with GM as the target company was reached in 2011 two days after the contract deadline—and negotiations had stretched into November back in 2007.

“All three companies are working hard toward a collective bargaining agreement,” said UAW President Dennis Williams in announcing that FCA had been selected as the target. The UAW had previously announced strike authorization votes by its members at all three companies. The UAW had temporarily given up the right to strike Chrysler and GM in 2011 under their bankruptcy reorganizations.

FCA is the smallest of the Detroit Three and has the lowest profit margins. That could make it more difficult for FCA to agree to wage hikes and move toward eliminating the two-tiered wage structure which pays more recently-hired UAW workers considerably less than their senior colleagues. FCA has the highest percentage of workers on the lower tier and Ford the lowest percentage. However, FCA CEO Sergio Marchionne has expressed support for ending the two-tiered system—without indicating how he thinks it should be done or how quickly.