Twice not so nice for ‘Charmed’ ads

May 20, 2002  •  Post A Comment

The WB thought it a charming-and necessary-idea: repurpose a broadcast network TV show later in the week on cable, keeping the same commercials during both airings.
One problem: It didn’t work.
So said Jamie Kellner and Jed Petrick, the top executives at Turner Broadcasting System and The WB, respectively, who have decided not to extend their experiment of running “Charmed” on The WB and sibling cable network TNT with the same commercials.
Bottom line, the idea didn’t work for the bottom line. Advertisers refused to support the concept of paying higher costs-per-thousand on “Charmed’s” cable run than buyers and their clients were used to paying for cable shows.
So while “Charmed” will continue to double-run new episodes on both The WB and TNT when it returns in the fall, its ratings will no longer be “cumed,” or aggregated, and the show will no longer be sold only by The WB’s sales staff. The WB will sell ads in the show for its WB airings, and the Turner sales forces will sell ads for the airings on TNT.
“Advertisers refuse to pay the quality-environment cost per point,” said Jamie Kellner, chairman, Turner Broadcasting System. “Everybody’s got the same issue,” he said of similar multiplexing deals at other conglomerates.
“Charmed,” for example, costs The WB about $1.2 million per episode, and TNT gets its run of that same original episode for about $150,000, according to sources (Electronic Media, Jan. 28, 2002).
To make the economics of the deal work, advertisers would have had to pay TNT about 80 percent of the cost of their WB spots, but advertisers, who in most cases were running the same commercial in The WB and TNT runs of “Charmed,” were willing to pay only about 50 percent of The WB rate to TNT, Madison Avenue executives said in January.
Advertising agency executives said they have valid reasons for not supporting the concept with their clients’ money.
Cable networks don’t necessarily have the “branding cachet” of broadcast networks, said Bob Flood, senior VP and director of national broadcast at Optimedia. And “cable doesn’t necessarily have the distribution,” he added.
The cry for higher cable CPMs also ignores the fact that cable is a dual-revenue-stream medium, with advertising dollars supplemented by subscriber fees, Mr. Flood said. Overall, cable CPMs may not necessarily rise, he said, but eventually “de facto equilibrium” could be reached because of broadcast ratings erosion or as individual cable programs enjoy increased numbers.
“Look, cable CPMs are significantly lower than prime-time network broadcast, which is the gold standard,” said a second buyer at a major media agency. “Furthermore, `Charmed’ doesn’t do really killer numbers on TNT that justify a significantly higher CPM than we give other programming on TNT.”
This buyer doesn’t buy the argument that “Charmed” deserves a higher CPM because it’s a prime-time broadcast-network-quality show on cable. “That really doesn’t mean anything to me and my clients,” the buyer said. “We respond to audience response. Listen, MTV is getting a killer premium for `The Osbournes’ for one reason and one reason only-it’s drawing a big audience.”
Still, at TBS they remain “totally believers” in multiplexing using the same commercials in both the broadcast network and cable runs as the future of television programming. “I still want to do it,” Mr. Kellner said.
For now, though, in a buyer’s market, the advertisers have declined to pay for the additional reach of the cable run, he said. “When you do something like this, it does change how [advertising agencies] have to deal with their clients and how they account for how they spend the money. It’s always difficult to get over the hurdles of new deals.”
As for dropping the idea for now, Mr. Kellner was resigned to the reality of the marketplace. “We believe the customer’s always right,” he said.
One of the problems in convincing his customers-media agencies and their clients-of the efficacy of his plan is that agencies see multiplexing and cumed ratings as an opening wedge to raise cable CPMs. “It’s one of the fears,” Mr. Kellner said.
“No one’s interests are being served” by the inability to cume, said Jed Petrick, president and chief operating officer of The WB.
Jordan Levin, entertainment president, The WB, cautioned that without multiplexing with the same commercials in the same run to offset the high cost of scripted programming, The WB-which currently airs the greatest percentage of scripted shows of any broadcast network-might at some point be forced to cut its commitments to scripted TV.
“Nobody’s bending,” Mr. Petrick said about the failure to find a way to lower costs, either by reducing license fees or by raising CPMs. “The producers don’t want to and the advertisers don’t want to.”
In the longer term, multiplexing will be back, Mr. Kellner said. “Within the next three or four years, you’re going to have a lot of multiplex and a lot of multiplay also,” he said. “Everybody’s got to get more audience. “It will improve back-end.”
The WB’s schedule includes just such a multiplay strategy. Its new 5 p.m.-to-7 p.m. Sunday block will include second runs of “Smallville” and “Everwood,” each of which will be sold separately from its prime-time run earlier in the week.#