Television must look to engage its market

Digital switchover, surviving a multi-channel world and making TV more accountable were some of the main issues tackled at Marketing Week‘s TV 2004 conference. By Amanda Wilkinson

Engagement. That was the buzz word that repeatedly came up at Marketing Week‘s TV 2004 conference last week. It is one that will continue to be used as marketers seek not only to find a way to engage with consumers through television in a multi-channel world, but also with commercial broadcasters in a quest for more evidence to justify their continued level of spend on television.

Speaking at the conference, Bartle Bogle Hegarty group chief executive Nigel Bogle warned that the world has moved to an age of information overload, while advertisers were considering shifting some of their TV spend to other activities, which they perceive to be more effective in driving sales and reaching consumers.

Only the highest advertising spenders could hope to get their brand message heard on TV through repetition alone, he said, adding that all advertisers will now have to produce more engaging work. He called on commercial broadcasters to restructure ad breaks so that the ads have a chance of engaging with viewers and standing out from each other and from programme content. In addition, he appealed to broadcasters to be more open to advertiser-funded programming.

“Give us a break,” he said. “Give us shorter breaks, a solus break, premier breaks that exclusively launch new campaigns.”

IDS chief executive Mark Howe said that UKTV was already experimenting with shorter breaks in a bid to stop viewers switching channels – an initiative that was unveiled at last year’s TV conference in Bath (MW May 8, 2003) – but he admitted it was difficult to convince media agencies to pay a premium for the slots.

The cluttered and sometimes downmarket advertising environment was also a concern for Toyota GB commercial director Paul Philpott. He appealed to commercial broadcasters and agencies to help advertisers lobby government to relax advertising regulations so that brands have greater scope to move beyond spot advertising and sponsorship idents and to get involved in providing entertaining content on TV.

Philpott also criticised commercial broadcasters for having done little to market TV since last year’s conference in Bath, either through an industry body or some other initiative.

Later in the day a consortium of the main commercial broadcasters in the UK, including BSkyB, Channel 4, Five, IDS, ITV, Turner Broadcasting and Viacom Brand Solutions, unveiled research conducted by the Ingram Partnership into how marketers and agencies would like to see TV marketed. Although the research has yet to be completed, unsurprisingly many respondents wanted to see a marketing body set up for TV that would be charged with demonstrating its effectiveness as a medium. Philpott also called for broadcasters to make TV more accountable by producing research that shows how the medium drives sales. Having revealed that Toyota had just revised its contracts with agencies so that they are paid in part by results (MW last week), Philpott also suggested that TV companies could be paid in a similar manner to make them more accountable: “Shouldn’t we, as advertisers, be looking to the TV companies to prove to us the real value of advertising on TV, and maybe even share in the commercial results that are generated, whether positive or negative?”

The issue of payment by results came up again in the session looking at the future for TV trading where it became clear that payment models for agencies varied considerably between clients. Kimberly-Clark media director Europe Oliver Cleaver said: “We research products, but not all of them are going to be successful. It is our responsibility as an advertiser to take these risks, but it’s not the broadcasters‚ or our agencies’ risk.”

Billetts chairman John Billett pointed out that agencies had become expert in managing their TV deals. Although there was little disparity between the rates obtained from broadcasters by the larger agencies, he said, clients experienced up to a 30 per cent price swing reflecting the variations in their own agency contracts. But he warned that agency margins were tight and that there would be “significant change” in the next few years as some agencies would have problems obtaining credit insurance due to the level of debt of their parent companies. As a consequence, advertisers would start to go directly to media owners through buying clubs.

Research again reared its head in this session, with questions being raised over BARB’s ability to measure small digital channels as well as the need for a form of measurement across all media.

On the subject of ITV, the Incorporated Society of British Advertisers director of media advertising and affairs Bob Wootton said that the trading season following the merger has passed off relatively quietly, despite the complexities of the contract rights renewal (CRR) remedy. However, he warned that in the future ITV could try to leverage its other brands such as ITV2. He said that advertisers would oppose any further consolidation of TV sales houses unless some larger material benefit for the businesses concerned could be shown.

Nevertheless, in his keynote speech David Elstein said that further consolidation was likely, as Five had “only a limited future for itself as a single-channel operator in a multi-channel world”. He added that the channel has little option but to “cosy up with Sky or Channel 4”. So far Rupert Murdoch has not been able to make the figures stack up, but the prospect of Five teaming up with Channel 4 could make him change his mind, said Elstein.

The former Five chief executive also queried the reasons behind the Government’s decision to push for digital switchover now that the value to be obtained by selling off the spectrum had depreciated. He also expressed doubt that switchover could be achieved by the target date of 2010.

In order to aid digital take-up, BBC director of marketing, communications and audiences Andy Duncan asked broadcastersto help it develop a subscription-free digital satellite service.

He said: “This will introduce real choice into the market and provide a route to digital for those outside Freeview’s current reach, but who don’t want to pay a monthly fee.”

Duncan also touched on broadband, explaining how broadcasters will look to exploit the medium by allowing internet users access to programmes that have been broadcast previously. It was an issue that was also picked up by BT head of broadcast media Steve Huddleston, who said that this new technology could affect TV viewing habits, but would also provide new opportunities for advertisers as commercial broadcasters may make the programmes available on the condition that the viewer watches various ads.

The development of interactive advertising was also explored in a presentation from members of the Zip Television’s Consortium 4TV, which is made up of advertisers that are launching a channel to host interactive ads.

Conference attendees were also treated to a presentation from BSkyB sales director Mark Chippendale and IDS chief executive Mark Howe on research conducted by the SFX consortium of multi-channel broadcasters showing that brands increasing their media spend and the proportion allocated to multi-channel TV out-perform other brands (results reported in MW November 27, 2003).

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