Channel 5 should forget about ‘doing a Tesco’

Channel 5 needs to raise revenue to fund its programming, but its plans to move into home shopping aren’t the best way of doing so.

Channel 5 chief executive Dawn Airey, talking in Edinburgh about her search for new revenue opportunities, posed some interesting questions.

Airey’s speech attracted a lot of interest, as she was addressing a subject close to many hearts – how to increase revenues in the face of the advertising downturn. Her solution was, in effect, home shopping – although couched in rather more interesting terms. “We have the eyeballs and we need to monetise that audience,” she said, before going on to say she wanted the channel to “do a Tesco”. But an idea that has perhaps bigger long-term implications for broadcasters was her interesting point about channels’ relationships with their viewers: “If they trust us with their leisure time, we have to ask what else we can sell them.”

This raises the question of what broadcasters actually do. Do they create (and leverage) programme-based content? Or do they provide distribution systems? Or are they in the business of providing quality leisure experiences – currently in our homes, but potentially anywhere?

Look at Channel 4, which describes itself as a “multi-channel, multi-platform media business”. Its commercial development department contributed &£2.2m net profit last year, with CDs (the Big Brother theme tune reached number four in the charts), videos from Ali G and Trigger Happy TV, plus 302,000 copies of the Big Brother book. The 20 million calls to C4’s premium phone lines didn’t go amiss, either.

C5 is strapped for programming cash, but needs to be very clear about what its core business is when looking for new revenue streams. So what does C5 “do”? And is it better off selling the attention (those eyeballs) of its viewers, or providing a distribution system?

The world doesn’t seem to be particularly short of screen-based distribution (or home shopping) opportunities at present. The Internet, Open and some rather unglamorous cable and satellite teleshopping channels make it a very competitive arena, and C5 is unlikely to generate much revenue there.

The channel does provide millions with a “quality leisure experience”, but to leverage that “brand trust” fully would require deeper pockets than C5’s, and long-term investment. So perhaps it should be following the C4 model and extending its programming brands across other platforms. The only trouble is that, at present, C5 has nothing like the valuable programming brands boasted by C4. And with limited funds available for programming, it’s a vicious circle.

But C5 does have some well-targeted programmes, so for marketers it could provide some interesting opportunities to “own” properties across a number of platforms. It’s not as revolutionary as “doing a Tesco”, but it’s probably the best way ahead for C5 in a chilly advertising climate.

Jennie Soffe is new business and marketing director at Universal McCann UK

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