Advertisers are crazy about Spanish-language broadcaster Univision Inc., even if Wall Street isn’t.
During the “upfront ad market,” Century City-based Univision sold $297 million worth of advertising, an increase of nearly 50 percent over its $200 million in upfront sales last year. (In TV lingo, “upfront” refers to the ad-selling period that runs from the time a network presents its fall season shows to advertisers in late May through the second week of June.)
Univision’s whopping increase is a pretty strong indicator that advertisers are starting to recognize the buying power of American Latinos. It came after Univision hiked its ad rates as much as 20 percent from year-ago levels in some time slots, putting them closer to (though still below) the rates charged by English-language networks.
“Many sophisticated advertisers are recognizing that while the incomes of individual Hispanics are not as high as the incomes of English-language viewers, the Hispanic household tends to have many more members, so the household income is actually higher,” said Henry Cisneros, Univision’s president.
Despite the revenue gains, Wall Street’s brief love affair with Univision seems to be over for now. Its stock, trading around $26 a year ago, soared to over $41 in January, but then started to plunge in June. It surged last week to around the $32 level, after hovering around $26 the week before.
Cisneros blames Univision partner Grupo Televisa S.A. for the stock tumble. Grupo Televisa, which is in heavy debt due to Mexico’s economic troubles, has announced plans to sell up to 13 million of its shares in Univision to provide much-needed cash.
“The market has been preparing all summer to be flooded with 13 million shares of Univision stock,” Cisneros said.
By the way, impressive as Univision’s upfront market was, it was surpassed by another locally based television network Warner Bros.’ The WB, which doubled its upfront sales from $150 million last year to $300 million this year.
Network spokesman Brad Turell attributed the gain to The WB’s addition of another night of programming (going from nine prime-time hours to 11), as well as to ad rate increases of 20 percent or so for some time slots and ratings gains averaging 29 percent for The WB’s target 18-to-34 demographic. That jump in 18-to-34 viewers is thanks to hit shows like “Dawson’s Creek,” “7th Heaven” and “Buffy, the Vampire Slayer,” he said.
Billboard ban
The L.A. City Council may have banned alcohol and tobacco billboards in certain zones last week, but it’s likely to be some time before the ordinance goes into effect.
Rex Heinke, an attorney with the downtown law firm Gibson, Dunn & Crutcher who represents outdoor media giants Outdoor Systems Inc. and Eller Media Corp., is poised to file a lawsuit over the billboard ban. And the first thing he’ll seek is an injunction preventing the ordinance from going into effect until the suit is resolved.
Cities around the country have been targeting billboards that advertise alcohol and tobacco ever since a court decision earlier this year that upheld Baltimore’s right to restrict such messages.
The Council’s action follows an ordinance already approved by the County Board of Supervisors that also restricts such billboards in certain areas.
But the city ban goes farther because, in addition to forbidding boards in the vicinity of schools and parks as the county ordinance does, it also prohibits their placement within 1,000 feet of residential zones. In urban-sprawl Los Angeles, that doesn’t leave a lot of options.
“It would be almost impossible to find a board in the city that’s not within 1,000 feet of a (residential) zone,” said Glenn Emanuel, president of La Mirada-based Vista Media.
Companies like Vista, which specializes in “eight-sheets” small billboards often located in low-income neighborhoods would be particularly hard hit by the ordinance, if it ever goes into effect. Emanuel estimates that 20 percent of Vista’s 5,000 boards in the city advertise alcohol or tobacco.
The big boys like Eller and Outdoor Systems are expected to take a substantial hit too, losing perhaps 10 percent of their clients in the city. That’s certainly reason enough for their planned lawsuit, which would challenge the city ordinance on the grounds that it violates both the First Amendment and state law, which gives the state power over the licensing, distribution and sale of alcohol products.
“We believe the state constitution preempts local regulation like this,” attorney Heinke said.
Bad P.R.
A recent column about the inability of the freshman class of P.R. executives to frame a comprehensible sentence generated a fair amount of mail and commentary most of it agreeing with the notion that our schools just aren’t teaching kids to write.
A recent press release from a Beverly Hills-based P.R. agency that crossed a Business Journal reporter’s desk might serve to illustrate the problem. This isn’t just an example of bad writing, it’s one of the most shocking examples of bad judgment ever encountered here in a promotional release.
Here’s the lead paragraph of the mailing that was intended to promote a Web site for singles:
“The lonely blonde at the bar is awaiting her drunk blind date. The bar is deserted. Her purported ‘hunk’ slips a crisp $20 bill to the seedy bartender. Ken, a Mohawk-haired, heroin addict with pierced everything proceeds to molest, slap and pull off her panties. Raped, Melissa doesn’t know what hit her. Her “date” whistles for his cronies and Spike a 6’3′ Mongoloid proceeds to laugh and watch while Teddy, another bonding friend, starts paddling her with a bottle Obviously Melissa didn’t join the only safe dating service ”
News Editor Dan Turner writes a weekly column on marketing for the Los Angeles Business Journal.
