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Integrated Deals Work for Discovery

Mar 29, 2004  •  Post A Comment

The upfront’s not that big a deal to advertiser-friendly Discovery Communications.
Not when cross-platform and worth from $5 million to $100 million already account for more than 20 percent of the programmers’ total ad revenues, said Joe Abruzzese, president, advertising sales, for Discovery U.S.
Discovery has 10 such deals already in place and expects to close a few more in the next few months, including one worth $100 million, he said. Major advertisers including Procter & Gamble and Johnson & Johnson have done deals with Discovery in the past.

These deals are complicated, Mr. Abruzzese said, and are negotiated outside of the upfront. He added that he’d like to do more, estimating that as much as 40 percent of the network’s ad revenue could come from in the future.
Even before Discovery’s upfront presentation to advertisers last week, one show Discovery Networks thinks could be a big hit next season, “No Opportunity Wasted,” was already 70 percent sold out, Mr. Abruzzese said. “No Opportunity Wasted,” hosted by Phil Keoghan, offers people a chance to achieve a life goal. It already has three prime sponsors-MasterCard, Chrysler and Circuit City.
Discovery is also looking to sell sponsorship packages in “Top 20 All Americans,” a series marking Discovery’s 20th anniversary season.
Being able to sell integrated packages reduces Discovery’s commercial inventory and could enable it to raise prices, possibly closing the CPM gap with broadcast.
“I’d love to close the gap,” Mr. Abruzzese said.
Scatter has been weak for broadcast, but Discovery’s volume is up 20 percent from last year, and that augurs well for cable to make gains in the upfront. “We’re seeing a shift in money every day,” Mr. Abruzzese said.
Discovery offered buyers several reasons for moving money from broadcast to Discovery. For one thing, the network pledged to start each commercial pod with a sponsor’s spot, rather than a network promo. Mr. Abruzzese said the change was effective last week.
Discovery also stressed that it offers quality, family-friendly original programming 52 weeks a year. Mr. Abruzzese noted that in the second half of the television season, broadcast ratings drop 30 percent, while Discovery’s ratings rise 13 percent.
For those reasons, Mr. Abruzzese said, “Cable is undervalued.”
One buyer, Bob Flood, senior VP of national electronic media at Optimedia, said Discovery appeared to show off several hit shows. But he said it remained to be seen whether cable networks, including Discovery, will be able to demand higher prices from advertisers.
Held at New York’s Museum of Natural History, Discovery’s presentation highlighted current hits and new programming on 14 networks and services during a two-hour-plus presentation.
Billy Campbell, president of Discovery U.S., said each network has increased its programming and promotional spending.
Discovery Channel, riding the surprise success of “American Chopper” and its Monday block of “Monster” shows, is producing 900 hours of original programming for the upcoming season. In addition to series such as “No Opportunity Wasted” and “Top 20,” Discovery plans specials on “The Last Days of Pompeii,” “Alien Planet,” which uses digital effects to show what life on another planet could look like, and a special that takes a close look at the wreckage of the Titanic.
TLC is planning special episodes of its big hits. “Trading Spaces” plans a musical episode, while “What Not to Wear” will search for the worst-dressed couple in America and fix them up. New TLC series include “Plastic Surgery,” which looks at everyday happenings at a plastic surgery practice, and “The Designers,” which tags along with in-demand interior designers as they work around the globe.
Animal Planet launches a new marketing campaign April 1 featuring the slogan “Living Breathing Entertainment.” The network also has new shows, including “Austin Stevens: Snakemaster,” which follows the daring herpetologist as he goes face-to-face with venomous creatures, and “Animal House,” which shows pet lovers how to make their homes more critter friendly. In another show, “Who Gets the Dog?” three families vie to take a canine home from the pound.
Travel Channel, best known these days as the home of the “World Poker Tour,” is adding two new series: “Road Trip,” in which a host will take viewers along on a special journey, and “Travel Gear,” highlighting new gadgets and gizmos. Travel also plans a series of specials titled “Once and Future City.”
Discovery Health plans a big new version of its “Body Challenge” franchise with “Body Challenge Heavyweights.” Participants in the year-long program aim to lose 100 pounds each.
Discovery Times plans a new series of documentaries called “Discovery Screening Room” and a new talk show, “The Political Dish,” hosted by New York Times reporter Todd Purdum.