Liquor spots will run on unwired net

May 13, 2002  •  Post A Comment

Distilled-spirits marketer Diageo Guinness UDV North America was prepared to spend $1 billion over five years advertising its products on NBC and, surprisingly, CBS, if that network had allowed hard-liquor ads. Now that money will go instead to the participants in an ad hoc, unwired network covering approximately 86 percent of the country.
Diageo will spend as much as $1 billion over the next five years advertising its products on the unwired network, according to Guy Smith, executive VP of external affairs for Diageo, who announced the unwired network during a speech at the Electronic Media/Advertising Age Upfront Summit on May 8 at the Grand Hyatt Hotel in New York.
News of the unwired network comes against the backdrop of the possibility of talks between CBS and representatives of the hard-liquor industry.
A Diageo spokesman confirms that those talks are scheduled, but a CBS spokesman denied that there will be any such talks.
Diageo’s expenditure for the unwired network is “at roughly the same scale as the network buy was going to be,” a Diageo spokesman said, specifying that the network buy was to have included both NBC and CBS.
“That billion dollars over five years was slated for the alpha networks,” the spokesman said. “It was for NBC and CBS.”
Sumner Redstone, Viacom’s chairman and CEO, confirmed during a recent interview that each of the adult-skewing Viacom networks, both cable and broadcast, has the option to accept or reject such advertising for itself.
Asked specifically if that included CBS, Mr. Redstone replied: “Leslie Moonves decides what’s on CBS, and he decides about social issues.”
“That’s no new edict,” a Viacom spokesman said later about Mr. Redstone’s confirmation. “Networks have always decided on their own.”
Furthermore, “There’s been no change in CBS’s policy” regarding accepting liquor ads, a CBS spokesman also said. “There are no plans at CBS to take hard-liquor advertising.”
Likewise, there are no plans to accept liquor advertising at the MTV Networks, including in particular VH1, whose older audience mix would qualify it for liquor ads under NBC and Diageo’s original self-policing guidelines. Those guidelines promised that NBC would only accept the liquor ads in programming primarily reaching adults.
Diageo, whose brands include Smirnoff, Baileys, Captain Morgan and Crown Royal, has put together its unwired network from among 200-plus TV stations, at least six (and perhaps as many as 35) cable networks and systems owned by nine of the 10 largest multiple system operators.
Of the major MSOs, only Time Warner Cable has so far declined to participate in the unwired network, which will be up and running with new ads beginning some time this summer, said John Mandel, co-managing director and chief negotiating officer, MediaCom, and the Madison Avenue executive most closely associated with NBC’s initial decision last December to accept the Diageo ads.
By Mr. Mandel’s count, stations from 96 broadcast station groups, from Acme to Young, have aired hard-liquor ads in the recent past. They will be among the groups that are contacted first to participate in the unwired network, he said. The exact size and composition of the network will vary, depending on which particular Diageo brand is being advertised and what the geographic and audience-composition goals of the particular campaign are.
Diageo turned to the unwired-network concept after NBC reversed its original position and decided not to accept hard-liquor ads, Mr. Smith said at the Upfront Summit.
Using an unwired network instead of a broadcast network to reach the nation’s TV viewers adds about $5 million annually in back-office and other expenses, Mr. Mandel estimated. On the other hand, he said that assembling the unwired network will likely avoid the high-profile congressional and social-advocacy-group antagonism that resulted from NBC’s original decision to air hard-liquor ads, reversing a ban that had existed since the dawn of the medium.