The hard sell

Apr 29, 2002  •  Post A Comment

It’s posturing season again. It comes every year between the sweeps in February and the announcement in May of the new TV schedule. To hear television executives tell it, there will be some measurable increases in the prices they will charge the country’s advertisers for time on their schedules.
But the flip side isn’t as upbeat. Advertisers, still reeling from economic fallout post 9/11 and hunkered in a conservative spending mode, aren’t promising anything. Many media buyers and industry watchers are predicting a flat upfront, when networks sell the bulk of their ad time for the next TV season.
In reality, this year could be much like the last, a buyer’s market where advertisers had the clout to be ultra-selective and to think long and hard before committing their money. After a few years of double-digit gains, there was a 13.7 percent drop in upfront spending in 2001 to $6.93 billion from $8.1 billion the year before. With the economy still unsteady, many in the industry think it’s overly optimistic to expect a significant bump this year.
“We hear the networks are feeling bullish, and there’s a lot of jockeying going on, but we haven’t seen that first budget from any of our clients yet,” said Tom DeCabia, executive VP at New York-based media buying firm Advanswers PHD, whose roster includes Gap, Old Navy and Sears Portrait Studio. “We’ll have to see the schedule announcements, see who has good development. That could mean a swing of money.”
Network ad sales executives have already said they’re eyeing 6 percent to 8 percent increases in costs per thousand, which would drive up the overall upfront take about $500 million from last year. Cooler heads, however, say the gains could be closer to 2 percent or 3 percent on average, with advertisers waiting until the third quarter to plunk down the cash. And until next season’s new programming slates are announced May 13, advertisers consider it a two-horse race between NBC and CBS, which likely can use their strong ratings to secure more dollars. ABC and Fox have stumbled this season and will have to gain some ground.
“A few months ago, media buyers were saying there would be no increases at all,” said David Miller, an analyst at Los Angeles-based Sanders Morris Harris Group. “Now there’s a lot of hype from the networks. With client budgets not final, it’s really tough to say what will happen.”
There does seem to be an ongoing refrain for everyone, though: Think fast, think smart, think out of the box.
“Clients are challenging agencies to be more effective,” Mr. DeCabia said. “We have to evaluate absolutely everything out there to see if what we’re recommending is the best way to reach the target. And we have to be flexible and nimble enough to change quickly, spend elsewhere if, for instance, one network’s prices go too high.”
Advertisers since last year have been in a position to demand more from networks. They have asked for and received integration into the content of television shows in return for their spending. In flush times, networks would not have considered such deals, but they are actively soliciting them today. As a result, brand and content are co-mingling in a way that hasn’t been seen since the early days of television, when programs such as the “Camel News Caravan” and the “Texaco Star Theater” populated the airwaves.
Media buyers say it’s not every client who wants to be woven into the fabric of a TV program. Those that do-particularly those trying to appeal to a niche audience-find that increasingly they can play a splashy, starring role outside their commercial spots.
A deal between ABC and Revlon has made the cosmetics company part of a three-month story line that revolves around Erica Kane, the iconic character on daytime soap “All My Children” who is played by Susan Lucci. Erica sends her daughter to infiltrate Revlon, a competitor to her on-air company, Enchantment. The idea came from the writers and programmers, said ABC executives, who pitched it to Revlon. It started in mid-March.
“In this fiscal and advertising environment, networks and advertisers are looking for opportunities,” said Angela Shapiro, president of ABC Daytime and ABC Family Channel. “But product integration has to be done in a way that respects the audience and makes sense to the story.”
Revlon, which has been struggling in the fiercely competitive cosmetics category, needed a credible way to get close to young women, who are core soap fans. For being part of the soap story, with frequent on-air mentions of its brand name, the company agreed to spend between $3 million and $7 million on ads on the network. Revlon does not have approval over scripts, and its executives have apparently been good-natured about being vilified on the show. (They’ve been called “vultures” at least once so far.).
ABC has since fielded a number of inquiries from other advertisers about being integrated into daytime shows, but the network will choose carefully, Ms. Shapiro said. It’s a good tactic to draw in a new advertiser or to get a bigger piece of an existing advertiser’s budget, but it shouldn’t be overdone, she said.
“You would risk alienating your audience,” Ms. Shapiro said, “and, in the end, you’d hurt yourself.”
Another deal recently signed will put Ford Motor Co.’s Lincoln at center stage on NBC’s “Tonight Show With Jay Leno.” The auto company, aiming for some street credibility, is building a stage for musical acts and will sponsor the Friday night summer segments called “The Lincoln Garage Concert Series.” Surrounding the bands will be various vehicles such as the Navigator and Aviator SUVs. Still to be determined: whether the musicians be driven onto the stage in Lincoln models or whether Mr. Leno, a well-known car buff, will mention the brand during the show.
Ford will spend some $9 million in media on the network and likely will promote its involvement in the show in its marketing. NBC will hype the musical segment by name throughout its schedule.
These kinds of marriages were inevitable because of the plethora of choice on TV, where satellite, digital, personal video recording and other technologies have fragmented audiences and created zap-happy viewers, said Robert Thompson, a Syracuse University professor of pop culture and author of several books on television.
“Madison Avenue is looking anywhere to find a solution to how to get its message across to an audience with so many reasons not to pay attention to them,” Mr. Thompson said. “So many things are mitigating against the old model ever working again.”