NEWS: Agencies’ inflation fears switch from ITV to Channel 4

Agencies’ alarm over the rising price of TV airtime has switched focus from ITV to Channel 4 as inflation soars on the station because of falling viewing figures.

Agencies’ alarm over the rising price of TV airtime has switched focus

from ITV to Channel 4 as inflation soars on the station because of

falling viewing figures.



The price of advertising on Channel 4 is thought to have increased by an

average of around 12 per cent in the first quarter of this year

following a downturn in viewing numbers.



The channel has faced stiff competition for audiences from BBC2 over the

past few months, and there has been a corresponding fall in commercial

impacts.



At the same time, demand for advertising airtime on the station was

healthy during January and February, pushing up the price for many

audience demographics.



Some media companies are, as a consequence, failing to deliver on the

savings they promised to make on their clients’ television adspend.



One TV buyer said: ‘Channel 4 is used by buyers as a cost regulator as

much as it is used as a unique coverage provider, especially on accounts

that are heavily audited. This inflation is causing some agencies real

problems, and making the channel far less attractive.’



ITV faced widespread criticism from advertisers and agencies for its

price inflation last year, which was well into double figures right

through to the autumn.



This year, ITV’s prices have increased by around 3 per cent year on

year, so that the price for many of Channel 4’s audiences has risen to a

comparable level.



For some key audiences, such as young adults, Channel 4 is now more

expensive than ITV. One ITV sales director said that more TV buyers were

now coming to ITV for their short-term airtime.



If Channel 4’s inflation continues throughout the year, it is likely to

have a beneficial knock-on effect for Channel 5 when it launches in

1997.



Andy Barnes, Channel 4’s sales director, was unavailable for comment.



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