New Strategies Target Faster Growth for '04A look at issues that both TV stations and cable operators will be focused on next year 11/23/2003 07:00:00 PM Eastern
The ad sales departments of TV stations and cable operators will be focused on more than run-of-the-mill spot TV issues next year. Here's a rundown of some emerging trends.
Ad Tag/Ad Copy. Comcast will roll out this technology in its 25 largest markets next year, with DMAs 7-10 up and running by the end of the first quarter. It allows advertisers to split their spot TV buys in two ways: by tagging commercials with the names of local retailers in their sales radiuses and by targeting different brands to the neighborhoods where they're most likely to generate sales.
Developed by Los Angeles interconnect Adlink, Ad Tag/Ad Copy is "powerful and effective," said Kathy Crawford, president of WPP Group media-buying service Mindshare. "Most people don't know how to use it yet, but it will become more prolific. When it does, it begs the question: When is broadcast going to be able to do this? They'll have to have a relationship with cable in order to do it."
Smarter packaging. Spot cable's biggest challenge is a shortage of inventory. As broadcasters are happy to point out, cable operators typically have about 600 local spots to sell per week, compared with 2300 at the average TV station. Add to that steep demand for high-profile networks like ESPN and Lifetime and less for smaller, newer outlets, and you have a classic inventory-management conundrum.
To get around it, Cox Media has created "GO," or Growth Opportunities, which groups cable networks and shows in four categories and prices them accordingly: Top Programs for Top Clients and Premium Networks include the spots in highest demand; the next two levels, Core Networks and Select Networks, offer sponsors opportunities to grow with programs not yet so high in visibility.
The effort isn't aimed at driving away mom-and-pop local advertisers, said Billy Farina, vice president of advertising sales at Cox Communications. "We're going to try to educate them: If you want to purchase a cable program with broadcast-TV–size ratings, it will cost you 'x.' If not, we have lots of other programs and networks that can be as effective but won't be as costly."
New-Business Development. Recognizing that their business has grown up and isn't expanding as quickly as it once did, TV stations are putting a record amount of effort into finding new customers and growing existing ones. Some of this plays out online, where TV stations host increasingly elaborate Web sites full of local information about such subjects as health, consumer issues, the law, shopping and technology. They also offer news headlines, traffic and weather reports, and contests to enter.
"TV advertising is great at branding but short on content, while the Web is long on content but its branding ability isn't yet proven," said Bill Spell, vice president of advertising at Cox Television. "We're trying to marry the two to offer advertisers high branding and high content."
On Demand Advertising. Comcast has begun experimenting with "Branded Navigation" in its Philadelphia system. In it, an advertiser's regular commercial airs, but, toward the end, Comcast superimposes a message something like this: "If you'd like to see more, click marketplace."
Marketplace, an option on the operator's VOD menu, offers scores of "channels," each devoted to a different advertiser or brand. Consumers can click on one to see an infomercial or other material about a product in which they are interested. "This is still very much in its infancy," said Hank Oster, senior vice president of Comcast Advertising Sales. "We're all learning."
Time Warner also plans to dabble in on-demand advertising next year. Cox has been doing so for some time with "Free Zone," a service that, like Comcast's, leads viewers to more information about products.