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PROMOTIONS DROVE RETAIL SALES LAST YEAR

Retailing tech firm DynamicAction says 2016 will be remembered as the “Year of Promotions” in retail, with 44% of all orders during the year sold on promotion, and 67% of all orders sold using a markdown. The result of this rampant promotional and markdown activity was a 24% margin reduction for North American retailers in 2016, the firm said in releasing data from its DynamicAction Retail Index at the National Retail Federation’s (NRF) Big Show in New York. “The consumer mindset has been hardwired to wait for a sale, and retailers continue to reinforce this wiring with ceaseless promotions in all channels,” said Sarah Engel, SVP of Global Marketing for DynamicAction. So retailers need to re-engineer their strategies to balance customer expectations with profit demands.

Retailers are entering 2017 with merchandise returns on the rise, already up 23% in the first two weeks of January, versus January 2016. Merchandise returns were up an average 8% during 2016 and up an average 18% for the holidays. “But it isn’t all doom and gloom for North American retailers,” the report says. Noting shipping problems in years past, it says retailers got their act together in time for gift giving, with orders that shipped late down an average of 6% during the holiday season. There were fewer late shipments, and free shipping was used on fewer orders during the holiday season. Late shipments were the norm throughout much of 2016, with an average 48% more orders shipped late compared to 2015. However, retailers tightened up operations throughout the year, leading to a decline in late shipments during the holiday season, down an average 6%. Free shipping, however, is still a consumer expectation, and an average 42% of orders shipped free in 2016. How can retailers counter demand for promotional discounts? The report says they need to connect customer data across channels to understand what else motivates them beyond promotions. For example, offer early access to new product lines, exclusive services or curated selections. Retailers can gain better insight into returns by connecting online and store returns. They can also test free shipping thresholds to determine how to increase average order value and improve shipping profitability. One women’s apparel retailer, for example, set a constant $100 threshold on free shipping after extensive testing. In 2016, the retailer’s free shipping orders were down 46% and had increased shipping profit per order by 121%.

ADVERTISER NEWS McDonald’s fourth quarter same-store sales were down 1.3%, about what had been expected considering the numbers were in comparison to the quarter when all-day breakfast had been introduced. That success had carried over into the first quarter of 2016, and the company is downplaying expectations for what is now the current quarter……Budweiser has dropped its sponsorship of the U.S. Olympic team after a 32-year run that has started at the Los Angeles games in 1984. An Anheuser-Busch

InBev spokesman said “We continually evaluate our sponsorships as our business priorities evolve and we’re adjusting our portfolio to reflect those priorities.” But Sports Business Journal reported Budweiser is just “the latest in a string of high-profile partners to not renew with the USOC”……Walmart is getting into the automotive sales business, creating partnerships with some dealership groups including number

one AutoNation. CarSaver, an online platform, will set up facilities at about 25 Walmart stores in four markets (Houston, Dallas, Phoenix and Oklahoma City) where customers can choose a new, used, or certified used vehicle and apply for financing and insurance while in the store or at CarSaver’s website. The program was tested in 2016 and on average, customers saved more than $3,000 off the sticker price using CarSaver. Ally Financial is also in the deal as the preferred lender.…After testing at a Ford store in Ohio, Ford Motor Credit Company customers will be able to buy and finance vehicles from a dealer’s website, making a trip to the store optional. The procedure uses a platform from AutoFi, a financial technology company. Ford Credit says the program will roll out to more Ford and Lincoln dealerships in the near future……Helped by the success of its tie-in with the Star Wars movie, Nissan’s Rouge was the best-selling nameplate other than pickups in December. Rouge sales were up 53% in December and 15% for all of 2016, and the Rouge Sport is due to reach dealerships this spring……(continued on page three)

FREE SHIPPING DEMANDED; RETURNS RISE

The Daily News of TV Sales Tuesday, January 24, 2017

PAGE 2 The Daily News of TV Sales @ www.spotsndots.com

NETWORK NEWS County music star Luke Bryan will sing the national anthem at Super Bowl LI. Bryan is a native of Leesburg, Georgia and admits he’ll be pulling for the Atlanta Falcons when they take on the New England Patriots on February 5th on Fox. Lady Gaga sang the anthem at last year’s game and will be perform the half-time show this year……Kristen Stewart will make her debut as host of Saturday Night Live on the February 4th show. Alessia Cara will make her first appearance as musical guest. The following week of SNL will feature Alec Baldwin in his record setting 17th appearance as host. Baldwin will be joined by musical guest Ed Sheeran……The inauguration of President Donald Trump helped the Late Show with Stephen Colbert get a rating win this past Friday. The CBS show posted a 2.9 Nielsen household rating in the metered markets, up +21% week to week and up +16% over the same night last year. The show beat both NBC’s The Tonight Show Starring Jimmy Fallon (2.3 HH rating) and ABC’s Jimmy Kimmel Live (1.9 HH rating) ……Raised by Wolves, a single-camera comedy from Juno writer Diablo Cody, has been given a pilot order from ABC. The project is an adaptation of a U.K. series that centers on a tough mother struggling to support her five, opinionated, eccentric kids on a shoestring budget. Raised by Wolves draws parallels to Roseanne, another blue-collar show with a strong mother figure, making ABC the logical home for the comedy……. CBS has given a pilot order to a new comedy from Dan Kopelman. Me, Myself and I examines one man’s life over a 50-year span. The show will focus on three distinct periods in his life: as a 14-year old in 1991, a 40-year old in present day and a 65-year old in 2042. Kopelman will serve as executive producer along with Dana Honor……A new untitled comedy from ABC’s Fresh Off the Boat co-executive producer Kourtney Kang has been given a green light from NBC. The comedy is based off Kang’s real-life experience growing up as the only girl in a mixed-race family in the Philadelphia suburbs. Fresh Off the Boat showrunner Nahnatchka Khan is also involved in the project, and Fred Savage is on-board to direct the pilot. Isabella Russo has been cast to play the lead in the show. She recently finished her run as Summer in the Broadway production of School of Rock.

DONE DEALS Nexstar Media Group, Inc. has named Alex Biles (pictured) as GSM at its property in Huntsville-Decatur (Flor) (DMA #79). Biles will oversee the sales efforts for WZDX (FOX), WAMY, MeTV and Rocketcitynow.com. Over the past 8 years, Biles has held National and GSM positions including WAAY, Huntsville-Decatur (Flor), and KBSI-WDKA in Cape Girardeau. Nexstar Media Group, Inc. also announced that Marc Hefner has been named Vice President and General Manager of WSAV (NBC), CW/MyNetwork subchannels and associated digital services, including WSAV.com, in Savannah, GA (DMA #91). Hefner’s most recent position was with WCWJ (CW) in Jacksonville.

1/24/2017

My fitness goals are different. Most people want to lose

enough weight so they look good in a bathing suit. I just want to lose enough so my

stomach doesn’t jiggle when I brush my teeth.

Kevin James

The Daily News of TV Sales @ www.spotsndots.com PAGE 3

TOTAL TV VIEWING UP LAST MONTH Americans spent more time watching television in December. After crunching Nielsen data, Pivotal Research Group analyst Brian Wieser says total use of TV across all sources of content inputs was up by 0.4% on a total day basis for adults 18-49 during December and up by 0.8% among all households. However, viewing of English-language broadcast networks and ad-supported cable was down by 3.5% for adults 18-49 and down by 0.9% for households, both on a total day basis. But Wieser says consumption via Internet-connected devices, including Roku, Apple TV and Google’s Chromecast, rose by 66% year-over-year to account for 9.2% of total TV use among adults 18-49 on a total day basis vs. 5.6% in December 2015 and 3.0% in December 2014. As for advertising, the analyst says national TV commercial impressions delivered among adults 18-49 fell by only 0.7% year-over-year on a total day basis, and by 0.4% on a prime time-only basis. National commercial loads across the industry rose to average 10.9 minutes per hour across all Nielsen-tracked programming during December 2016, up from 10.7 minutes per hour in December 2015 and 10.4 minutes per hour in December 2014. Most network groups increased or held constant their commercial loads during the month, with Scripps Networks Interactive and Time Warner notably reducing loads across their networks. Viacom produced the largest share of C3 commercial impressions during December with a 15.4% share of adults 18-49, vs. 15.3% during the year-ago period on slightly higher ad loads (14.8 minutes per hour in December 2016 vs. 14.3 minutes in December 2015). AMC Networks posted the most significant gains, with 3.6% share in December 2016 vs. 2.9% in December 2015, while Wieser says Time Warner saw the most significant declines, generating 10.0% of commercial share in December 2016 vs. 11.7% in December 2015.

COMPETITIVE INFO Cinema advertising is increasingly popular with advertisers. Kantar Media chief research officer Jon Swallen tells the London-based advertising publication M&M Global that cinema ad sellers in the U.S. have benefited from bringing a wider range of national advertisers, who have larger budgets than local and regional advertisers, as well as charging higher CPMs and selling more inventory. He says on-screen ads in movie theaters act as an extension of a video-first media strategy and notes that the U.S. movie-going audience is skewed toward the Millennial generation, with nearly 50% of ticket buyers aged 18-34. “As a result, the ranks of top-spending cinema advertisers include a number of brands with modest, not large, TV budgets and for whom young adults are a core target market,” Swallen told the publication.

“The recent gains cinema has made with national marketers are in part because the medium has made itself more like TV in order to better compete for a share of the fragmenting video ad budget,” Swallen said.

TOP BRANDS TOPPED BY YOUNG NAMES Our final report on YouGov’s Brand Buzz report looks at the top ten brands of the 1500 that were studied and—no surprise, as it usually does exceptionally well on these kinds of rankings—Amazon.com is number one. Amazon recorded a 35.5 positive score. The study takes the percentage of respondents that would recommend a brand to friends, then subtracts the percentage that would advise friends to avoid the brand, so scores can range from plus-100 to minus-100.

A point of note by Adweek: half the top ten brands did not even exist a generation ago. Two competing retailers are among the top ten (Lowe’s, number five at 20.7 positive and Home Depot, number 8 at 19.8), one old P&G brand (Dawn, number nine at 19.7), and one food that’s been a TV advertiser for decades (Cheerios, 19.3), along with a candy that’s also been around for many years, M&M’s, 20.7). Along with Amazon, the “young” brands that have grown to the top of

the list in pleasing customers in a relatively short time are Netflix (31.7), YouTube (28.4), Google (25.5) and Cancer Treatment Centers of America (20.5).

ADVERTISER NEWS (continued from page one) ……The first move made by Save-A-Lot after having been sold by Supervalu is to abandon the West Coast. The chain will close all its locations in California and Nevada as well as a distribution center. A spokesperson said the closures account for less than one percent of the company’s network which before the announcement totaled about 1400 stores in 39 states……Whole Foods Market will open the first East Coast store (its fourth overall) of its 365 sub-chain in Brooklyn, New York. Retail Leader notes the 365 stores are cheaper to build and operate than the traditional Whole Foods store and are meant to offer lower-priced items targeted to younger shoppers. Whole Foods says it has 23 store leases currently in development.

1/24/2017

Conan O’Brien

SUNDAY NIELSEN RATINGS - LIVE + SAME DAY

The inventor of the world’s first artificial test-tube hamburger said that ‘It

looks, feels, and hopefully tastes like meat.’ He was

immediately sued by Arby’s for stealing their slogan.