Friday, November 2, 2018 RISING INTEREST RATES PINCH ...

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RISING INTEREST RATES PINCH OCTOBER AUTO SALES

ANALYSTS EXPECT SLOWDOWN TO CONTINUE U.S. light-vehicle sales, behind strong light-truck demand

and elevated incentives, edged up 0.4 percent in October, signaling the second-half slowdown that began in July is moderating. The seasonally adjusted, annualized sales rate came in at 17.59 million, the highest of the year, and well above forecasts for 17.3 million, but down from 17.9 million in October 2017, when demand soared following Hurricanes Harvey and Irma.

Sales in 2018 have now risen 0.5 percent through October, but analysts still expect the second-half slowdown to continue. Volume skidded three straight months beginning in July, with the September decline ? 5.5 percent ? the largest of the year.

Rising interest rates and higher vehicle prices were key factors, and No. 2 carmaker Ford warned of slipping consumer confidence. Ford reported a 5 percent decline in sales for its pickup trucks, while overall sales fell 3.9 percent to 192,616 units in October, hurt by lower passenger car demand. "Interest rates are taking payments up along with our transaction pricing. So little bit of pressure there," said Mark LaNeve, vice president, U.S. marketing, sales and service at Ford.

Automakers have been helped as more U.S. consumers shift away from traditional passenger cars to larger SUVs and trucks, which tend to be more profitable for producers.

Fiat Chrysler said U.S. sales rose 16 percent on higher demand for its Jeep and Ram vehicles.

SUVs have also been a bright spot for Ford, contributing about 35 percent of its total U.S. sales volumes in October, up from 31.6 percent a year ago.

Toyota said its U.S. sales rose about 1.4 percent to 191,102 units, due to increased demand for Highlander and Tacoma SUVs. Honda's sales fell 4 percent to 122,182 vehicles, on weaker demand for passenger cars while Nissan's sales fell 10.6 percent to 109,962 vehicles.

Earlier this year, No. 1 U.S. automaker General Motors switched to reporting sales quarterly instead of monthly.

Subaru reported its monthly sales were up 2.5 percent. That's the 83rd straight month of increases for the brand flush with rugged crossovers and SUVs buyers want.

Among other brands, sales rose 2.8 percent at Hyundai; 1.6 percent at Kia; 4.6 percent at Volkswagen; and 8.4 percent at Mitsubishi. Deliveries dropped 10 percent at Mazda, 14 percent at Mini and 32 percent at Smart.

Audi's U.S. sales fell 17 percent in October, snapping the luxury brand's string of year-over-year gains at 107 months.

Among other luxury brands, October volume jumped 43 percent at Land Rover, 0.2 percent at BMW and 4.6 percent at Volvo, but fell 4.9 percent at Mercedes, 80 percent at Genesis, and 8.4 percent at Jaguar. That marked the 13th consecutive month the British marque's volume has skidded year over year.

ADVERTISER NEWS CVS Pharmacy is making a defensive move as Amazon

pushes onto its turf. The drug store retailer announced it has launched a pilot membership rewards program, called CarePass, in the Greater Boston area. An addition to CVS' existing ExtraCare rewards program, the new program offers in-store and online perks, including free delivery on most medications and purchases, access to a 24/7 pharmacist

hotline, and 20 percent off all CVS Health branded items. Similar to Amazon Prime, the new CVS program comes with a membership fee. CVS is charging CarePass members $5 a month, or $48 a year... Nintendo has set a goal of selling 20 million Switch consoles this financial year and is looking to popular classic games such as Super Mario and Pokemon to do it. TechCrunch says about 5 million Switch units have been sold, and Nintendo hopes to boost that number by releasing Super Mario Party, Pokemon: Let's Go, Eevee, Pok?mon: Let's Go, Pikachu! and Super Smash Bros. Ultimate... Hibbett Sporting Goods has made a deal to help strengthen its position in the competitive sporting goods segment. The company says it's acquiring City Gear, a privately held specialty retailer of premium athletic footwear, apparel and accessories. City Gear operates 135 stores in 15 states... Banana Republic wants a piece of the beauty category. The Gap-owned company is testing a luxury Cos Bar beauty shop inside of the retailer's San Francisco flagship, according to Family Health Tale. The shop-within-a-shop will sell products from the beauty retailer's luxury base, as well as newer, less expensive brands. The section is about one-third of the size of a standard Cos Bar location... The Seattle Times reports that as Starbucks begins its holiday sales push a week earlier than normal, the company plans to offer a 50-cent discount on drinks served in seasonal reusable cups after 2 p.m. during the next two months. The coffee company usually gives customers 10 cents off a drink if they bring their own cup. The increased incentive, running through early January, is part of an ongoing effort to drive business to Starbucks stores in the afternoons and a broader sustainability initiative aimed at reducing waste from disposable cups... For Amazon, it's Black Friday already, Fast Company reports. The company has officially launched its 2018 Black Friday Deals Store highlighting millions of products already on sale this holiday season. For the record, 2018's Black Friday is still three weeks away, on Nov. 23... Target says it it will open its doors earlier on Thanksgiving this year, as it expects throngs of shoppers to head to its stores across the U.S. after an early turkey dinner to shop its deals. The retailer will open at 5 p.m. on Thanksgiving and close at 1 a.m., then reopen on Black Friday at 7 a.m. Last year, Target opened at 6 p.m. on Thanksgiving. Kohl's and Macy's also have announced plans to open at 5 p.m. on Thanksgiving this year, sticking with what they did in 2017.

CABLENET CHATTER

ACTOR WANTS TO FIX AD MEASUREMENTS

Season 7 of Bravo's Vanderpump Rules will open on Business Insider reports that actor Edward Norton's

Monday, Dec. 3 at 9 PM (ET), leading into the luanch of startup wants to fix the way TV ads are measured, and a

new docuseries Unanchored at 10 PM. Following nine best handful of ad-tech investors have put millions behind it.

friends aboard a 56-foot catamaran for three weeks in the Edo is a data and measurement startup with a database

Bahamas, Unanchored will air new episodes on back-to- of 47 million television airings that helps marketers

back nights every Monday and Tuesday at 10 PM (ET)... analyze the creative and placement of their TV ads.

Animated stop-motion series The Shivering Truth will Norton and Daniel Nadler founded the firm, which has

premiere on Cartoon Network's Adult Swim on Sunday, raised $12 million in Series A funding.

Dec. 9th at midnight (ET). The episodes are described as The TV-tech industry is exploding in terms of funding, and

a series of loosely-linked emotional parables about stories a growing number of firms promise advertisers granular

within tales that crawled out of the deepest caverns of the stats about their TV campaigns.

unconscious mind... Deadline says

"We had seen that the legacy media

Investigation Discovery has ordered

companies were getting disrupted by

a six-part crime series about murders in

Netflix and Amazon who were using

small towns. Welcome To Murdertown follows the baffling murder mysteries where it's not just one person who's

Dear trick-or-treaters: Would it kill you to say "thank you"

organic data capabilities as significant advantages," Norton told BI. "At the same time networks were facing the

hiding something ? it's everybody. From

when I hand you a freshly

assertion by Google and Facebook that

small towns and tight-lipped communities

made egg salad sandwich?

digital advertising was more effective,

to tight-knit families, investigators must

and none of the legacy measurement

penetrate a wall of silence to crack the

players were really helping them

case. It premieres Tuesday, Nov. 13.

Conan O'Brien

challenge that with sophisticated data." Edo's goal is to amass a huge library

THIS AND THAT

of data pulled from TV networks to help

Third-quarter consumer spending on

determine how likely someone is to buy

subscription video apps jumped 15 percent from the first a product after watching an ad, based on data about how

quarter to reach $329 million, extending a growth trend similar ads have performed in the past.

that's likely to continue, a report by Sensor Tower says. The company claims to have a database with access to

Netflix maintained a clear margin over rivals, but Hulu saw 47 million TV airings across 80 categories of advertising

the biggest percentage gain... Several Senate Democrats and 2,100 brands. Edo's clients include ESPN, Turner,

are requesting the FCC reconsider the cable deregulation NBCUniversal, Paramount and Lionsgate.

proposal it approved in September, which they say would "Our ultimate goal is to be an alternative currency to

reduce resources for public, educational and government the way that TV advertising is bought and sold," said

programming. The FCC's decision allows a local franchise Edo CEO Kevin Krim. "We can run very advanced data-

authority's in-kind commitments to be applied toward the science models to develop expected norms of responses,"

5 percent franchise fee cap without having it go to PEGs... Krim said. In other words, Edo can construct a baseline

Thousands of Google employees staged walkouts at offices estimate to compare an ad's performance with... Apple

around the globe yesterday to protest the company's handling is warning that sales for the crucial holiday quarter would

of sexual harassment claims. The protestors are demanding likely miss Wall Street expectations, which CEO Tim

changes in how the company handles complaints in the wake Cook blamed on weakness in emerging markets, foreign

of a New York Times article revealing that two accused exchange costs and uncertainty whether the iPhone

senior executives were seemingly rewarded with sweetheart maker can keep up with demand for new products. The

exit packages, while a third remained employed.

weak forecast by the world's most valuable technology

company sent shares down as much as 4.3 percent in

FAKE POLITICAL ADS ELUDE FACEBOOK

after-hours trading.

Vice created fake political organizations like "Cookies for

Political Transparency" and "Ninja Turtles PAC" and then CABLE TV NEWS AD DOLLARS CLIMB 11%

got Facebook's approvals for fake ads it said were "paid for MediaPost reports that for the 2017-2018 TV season,

by" prominent politicians like Sens. Mitch McConnell and TV news programming climbed 3 percent in advertising

Chuck Schumer.

revenue versus the season before, according to Standard

The stunt showed how Facebook has no way of curtailing the Media Index's AccuTV service.

manipulation of its platform by bad actors. Instead of heading Cable TV news networks collectively posted a big 11

off the problem, Facebook told Vice it's begun keeping an percent hike -- from $2.08 billion to $2.31 billion -- with

archive so that independent researchers can suss out what broadcast TV network news programming down 4 percent,

the damage was after the election.

from $2.37 billion to $2.27 billion.

The Information says the problem is Facebook's reliance SMI primary data comes from the raw invoices of media

on artificial intelligence, which is proven to be worthless for agency holding groups -- five of the top seven groups,

filtering this type of content. The only way Facebook could making up 70 percent of the national TV market. For SMI's

identify this type of bad behavior is by hiring people to sift AccuTV product, it models 100 percent of commercials in

through political ads, which would be very expensive.

the TV marketplace across more than 125 networks.

In the most recent October period, Fox News Channel

PAGE 2

led all cable news channels -- and all ad-supported cable

networks. In prime time, it was up 25 percent in total



Friday, November 2, 2018

viewers to 2.8 million and 13 percent higher in key 25-54 viewers at 332,000.

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