It’s the kind of deal ITV has been seeking for years. The channel has persuaded two advertisers to sponsor huge blocks of its programme schedule, with Toyota signing up for the whole of New Year’s Eve and Day and Panasonic backing much of Christmas week (MW December 11).
If these costly “showcase” sponsorship deals stand out through the wrapping paper, drunken family rows, cigar smoke and the rest of the festive cheer, they will be a foretaste of ITV’s sponsorship strategy over the coming years.
The ITV sponsorship team has been trying to stitch together similar event-based deals for some time. But what often appear ideal sponsorship marriages turn out to be made in hell. For instance, the Royal Mail or card manufacturers might find it difficult to sponsor St Valentine’s Day because they involve purchases or orders that have to be made at least 24 hours before the day itself.
Carlton, which negotiated the deals, claims ITV has been building its sponsorship revenue by 20 per cent each year since 1989 and it is worth about 40m this year. Still, sponsorship only accounts for two per cent of ITV’s ad revenue. But if showcase deals are a success, this could double in just a few years.
There are pitfalls to such deals – ITV risks alienating other advertisers in the same sector, and, perhaps more importantly, annoying its viewers with blanket coverage during these seasons.
Toyota has signed an 18m deal to sponsor most of New Year’s Eve and all of New Year’s Day for the next five years, including the millennium. This year, a total of 32.5 hours of TV, comprising 19 programmes, will carry idents and break bumpers for Toyota’s new car, the Avensis. The credits have been devised by Toyota’s advertising agency, Saatchi & Saatchi.
For the Japanese car giant, the deal guarantees that it will always be the first manufacturer on TV every New Year, and also at that all-important start to the new millennium. Already Toyota has plans for next year’s sponsorship blitz, when it will be promoting a new small car for launch in 1999.
The deal gives Toyota blanket coverage at the start of the crucial January sales period, and will help it achieve “cut through” at a time when dozens of car manufacturers want to advertise.
As Mediapolis managing director Marc Mendoza says: “In the eyes of the consumer, all car ads are the same. Too many just show cars driving fast along winding roads. Media is the only way you can differentiate them.”
One media buyer for a rival car manufacturer says: “It’s illustrative of a broader trend among car makers in a hugely congested market trying to find ways of lifting themselves out of the clutter. General Motors is trying to do this with its World Cup sponsorship.”
Ironically these new longer sponsorships obviously make media clutter worse, much to the irritation of other car advertisers.
Another observer points out: “ITV is actively trying to build share of broadcast deals. Car makers are having their arms twisted to commit to a high level of broadcast share but if GM is sponsoring the World Cup and Toyota is sponsoring one-and-a-half days a year, it is starting to undermine the rationale for committing money. It’ll make advertisers think again because it’s no longer virgin territory.”
As part of the deal, Toyota is also sponsoring the ITV Movie Premiere series for the next three years, and ITV’s disability programme, called The Link, with its Motability scheme for disabled drivers, to maintain awareness of the corporate brand during the year.
Meanwhile, Panasonic has signed a 500,000 deal to sponsor three or four programmes each day over Christmas week, from December 21 to 27. On Christmas Day, these include the film Honey I Shrunk the Kids and the Christmas children’s special Father Christmas and the Missing Reindeer.
Sceptics question Toyota’s wisdom in signing up to a New Year deal, when so many viewers will be too befuddled to care about advertising, and to a deal that will not include Coronation Street (already sponsored by Cadbury), a documentary on Diana, Princess of Wales (not thought suitable) or news bulletins, which cannot be sponsored under Independent Television Commission regulations.
Toyota argues that the target market – 35- to 44-year-old ABC1s – won’t get too drunk to be receptive to its message, though it would be interesting to see its evidence.
More broadly, some question the communications value of broadcast sponsorship, which is tightly restricted by the ITC Code. Under the terms of the spring 1997 Code, advertisers cannot show their specific or branded product or any visual representation of their product or service.
Product or service benefits cannot be referred to, credits must not directly encourage purchase or rental of the sponsor’s goods and they must not include any visual or aural extracts from the sponsor’s television advertising.
The principles of these restrictions are to maintain the distinction between advertising and sponsorship, by ensuring that credits are not used as a way of extending allowable advertising minutage, and to preserve editorial integrity, by not allowing programme content or scheduling to be distorted for commercial purposes.
However, they make many clients and agencies sceptical about the value of broadcast sponsorship. One agency source says: “Pricing broadcast sponsorship is a bit like holding up a finger to see which way the wind is blowing. It’s seen as having about half the worth of spot advertising, although others might cost it at 70 per cent less.”
David Prosser, head of sponsorship at Carlton, who negotiated the Toyota deal, claims research by Millward Brown shows sponsorship can achieve awareness levels at least as good as spot advertising. “In terms of communication, sponsorship can have exactly the same effect as spot advertising. You could price it exactly the same,” he adds.
Prosser says broadcast sponsorship will bring in 40m for ITV next year, accounting for less than two per cent of total advertising revenue.
So is ITV running the risk of swamping its brand with someone else’s, and making the market even more cluttered? Mark Wood, commercial director at Sky Sales, says: “The more sponsorship a station has, the more confidence it has in its brand. The client is making a firm statement – I want to be linked with this channel and this brand.”
David Charlesworth, head of sponsorship at Channel 4, comments: “I don’t think we would do it. We’re not quite ready to hand over entire portions of our channel to sponsorship.”©
He reserves judgment on the deals until he has seen them. He says: “The credits might be rather engaging. It is being positioned as something very special. ITV will be well aware of the risks if there is a backlash.” He does not believe rival companies will be put off advertising because of the Panasonic or Toyota sponsorships.
According to the ITC, many viewers actually welcome broadcast sponsorship, particularly if they see it as a good “fit” with the programme, and if they believe the myth that it helps to pay for the programme directly.
Prosser and Mike Moran, marketing director of Toyota (GB), insist that Saatchi & Saatchi’s series of idents are funny and entertaining, and varied enough for each type of programme (film, chat show, drama and so on) not to bore the viewer.
Moran says: “Toyota launches more new cars than any other motor manufacturer. We are doing this for a very particular, single-minded reason, to get early awareness of the Avensis brand. I’m not claiming it is rocket science.”
The idents feature different people in different situations in the back of a car (not overtly branded as an Avensis), for example one New Year’s Eve/Day ident for movies and drama shows a man fighting with a “monster” – his seatbelt.
Both the Toyota and Panasonic deals are a statement of faith in the ability of ITV to deliver popular programmes this festive season. Yet one source says of Toyota: “It has backed the wrong horse.
It has committed itself for five years to a market that is in decline – the question is not whether it is declining but how fast.
“In fact it had no choice – there was no other horse left to back – Ford has got satellite tied up. This is the strategy of a company which has more money than sense.”
ITV’s audience share of the year’s first week has fallen by more than ten per cent since 1993, when it stood at 42.1 per cent, to 31.6 in 1996. ITV is traditionally trounced by the BBC at this festive time.
Moran refuses to give details of the options he has on the deal, but it is widely understood that Toyota can pull out if ratings are unsatisfactory.
It is known two programmes – a repeat of an episode of Mr Bean starring Rowan Atkinson and a comedy show starring Spike Milligan in front of a celebrity audience – were added at a late stage to this year’s New Year schedule to strengthen it.
Moran says: “ITV has got to deliver the quality programming. What sponsorship activity it takes is almost irrelevant to viewers, as long as they find the credits add value. Let’s not kid ourselves, people don’t turn on the TV to watch programme sponsorship.”