Amid a glut of home improvement shows on the broadcast and cable networks, DIY-Do It Yourself Network said it continues to grow and expects to become profitable by the end of the year.
The Scripps-owned network is now in 31.2 million homes, double where it was 18 months ago, and has plans to begin subscribing to Nielsen Media Research ratings sometime next year.
Ahead of that, DIY plans to launch next month what it is calling its biggest promotional campaign in its five-year history. But this campaign will follow a different blueprint than most other network promotions.
DIY is forgoing a dedicated television campaign because, with the network’s still relatively small distribution, “There’s still a lot of potential waste there,” said Bob Baskerville, president of DIY. Instead, the network will find its core audience of project enthusiasts through shelter magazines, the publications put out by the big-box hardware stores and various project-oriented Web sites.
Even without TV, the campaign represents more promotional spending by DIY than ever before. “We’ve really had meager marketing budgets in the past five years,” Mr. Baskerville noted.
The campaign dovetails with one of the network’s quarterly sweepstakes, in this case “The Great Garage Giveaway.” Top prizes are cash and a new GMC SUV. Sweepstakes sponsor GMC has been a key backer of the network’s “Ed the Plumber” show and has advertised on other car restoration programming.
Last year’s “Great Garage Giveaway,” which gave away a 1963 Corvette that had been restored on-air during the show “Classic Car Restoration,” garnered 3 million entries, second only to HGTV’s Dream Home.
The campaign uses the theme “This Is My Network.” Mr. Baskerville said that’s because it’s aimed at people who view doing projects as a creative outlet and see a completed job, be it a newly dug garden or a freshly painted room, as their own masterpiece.
The campaign is designed to build consumer awareness and brand loyalty before the network begins getting Nielsen rating in 2006. DIY is waiting until then because “We don’t think the sample Nielsen currently has in place works for small diginets that are still not fully distributed and are targeted in their programming approach.”
He said Nielsen has promised improvements in measuring digital networks.
A Nielsen spokesman said the ratings service has been expanding its sample from 5,000 homes to 10,000 homes and is including DVR and time-shifting homes, which are all digital.
DIY’s genre of home improvement shows are crowding the airwaves and causing some, notably TLC’s “Trading Spaces,” to slide in viewership.
But while those shows are competition, Mr. Baskerville sees DIY’s programming as operating on a different plane.
“An extreme home makeover is really entertaining to watch. I’m not sure you get a whole lot of detail on how to do the projects,” he said. “Those shows will show you what to do; we’re kind of what’s between the dissolves on television. We show people how to get it done and reinforce it on our Web site.”
He added that DIY does projects that real people want to do and can do.
So even while acknowledging that MTV’s “Pimp My Ride” is fun to watch, Mr. Baskerville pointed out that it’s different from DIY’s automotive programming. “The amount of money that’s spent in tricking out those cars [on `Pimp’] is hardly attainable,” he said. “What we’re doing is really what a younger guy in high school or college would want to do, probably spending $1,000 or less on their car, but doing some really cool stuff to it. And we show them how to do that.”
DIY is working to upgrade its original programming but plans to stay true to its step-by-step roots.
“Ninety percent of what we do is still project-driven, and we probably would continue to keep it that way. We realize occasionally we’re going to deviate and move more into a lifestyle-type show, but it’s not going to be nearly as often as HGTV and Food [Network] do,” he said, referring to his sister Scripps networks.
Like HGTV and Food, DIY has used original programming to ingratiate itself with cable operators. While respected, Scripps doesn’t have the clout of a huge media conglomerate behind it.
Mr. Baskerville credits the network’s distribution growth to the hard work of its affiliate relations team and on Scripps’ embrace of video-on-demand content, which is provided free to operators.
“We feel our type of programming is a natural fit for on-demand,” Mr. Baskerville said. The operators have agreed. “That’s helped drive distribution deals as well,” he said, especially with larger operators such as Comcast and Time Warner Cable.
“DIY is doing awesome,” said Derek Baine, senior analyst at Kagan Research. He called DIY an example of “how jumping on the VOD bandwagon early can help drive sub growth.”
That subscriber growth will pay off financially. Mr. Baine concurred with Mr. Baskerville’s assessment that the network will turn cash flow-positive later this year.
For 2005 Kagan projects DIY will have revenues of $46.3 million and costs of $49.6 million. In 2006 the network is expected to be in the black, with $65 million in revenues and $54 million in expenses.
Programming expenses were estimated at $21 million in 2004, growing to $25.2 million in 2005.
While striving to improve the quality of its shows, Mr. Baskerville said that though the network will remain heavily project-driven, “There are some shows that will be “a little more lifestyle and experiential [-oriented].”One is “Celebrity Hobbies,” about what celebrities do in their spare time.
Another is “DIY Trade School,” which focuses on real people learning different trades, from a student going to auto body school to a banker learning about woodworking as he joins the family business. “It’s not a step-by-step show,” Mr. Baskerville said. “It tested through the roof because there’s a good story behind it, but then there’s good takeaway information. It’s a good way for us to leverage our Web site because we can give tidbits of information. You can find out more about how to patch a rust hole on a car by going to our Web site.”
“The one thing about DIY and the Scripps networks, they push their content out onto the Internet better than other entities out there,” said Stacey Lynn Koerner, executive VP and director of global research integration at Initiative Media. “They’re very good about pushing their content that way, and it may have some halo effect on their actual broadcast properties.”
Mr. Baskerville stressed that the credibility of its projects may also separate DIY from project shows on other networks. “We’re fighting an uphill battle all the way. We need to make sure we’re doing it right and all the information is rock-solid,” he said. “Some of these other shows, it’s all about ratings, particularly a show on a broadcast network.
“If it starts to underperform, at some point it’s going to be kicked to the curb and there will be something else coming in that won’t necessarily be about home improvement,” Mr. Baskerville said. “We’re in it for the long haul.”