Media Buyers Get the Squeeze7 May, 2010 By: Nicole Urso Reed Response
Also, the release of Apple’s iPad in March will continue to drive usage of smart phone devices and enable users to consume and interact with advertisements in a much more personalized and immediate fashion. Buyers should consider if their DRTV campaigns would benefit from an online or mobile marketing component.
“The demarcation between traditional direct response and traditional brand advertising is going to continue to blur because you have more and more person-to-person interactivity whether it’s on the phone or whether it’s on a set top box,” says Rubin.
Cross MediaWorks conducted an analysis, which found that at least 85 percent of brand advertising carried an element of direct response within it, such as a phone number or Web site.
Cable and broadcast networks often carve out special media rates for hybrid campaigns, and Lyons is on the forefront of this transition at A&E.
“We look at advertisers as advertisers, and we don’t make a giant distinction between direct response and general ad sales,” says Lyons. “That’s one of the things that’s helped us in the company really achieve our goals during the past couple of years.”
He says that the term fire sale isn’t thrown out as often, and the direct response business is no longer just about finding cheap remnant inventory. The only thing that separates DR from general advertising is its metric for success. General advertisers want viewers, measured in CPM. DR advertisers want calls, measured in CPA or CPO.
“So if you have something that’s performing really well, you can actually benefit — from a network perspective — and achieve more value from a direct response advertiser at times than you can from a general market advertiser,” says Lyons. “They’re all clients and they all have different needs and different metrics.”
When media rates spike, buyers have to think more strategically about ad placements. “Agencies need to be more open to creative deals with sales people,” says Fays. “People need to start looking at how they can put five networks together with an online component and figure out the best deal overall, instead of saying, ‘I want five daytime spots on TV Land.’ Doing business like we did in 2008 and 2009 is not going to fly in 2010. You have to start thinking more creatively.”
Lyons suggests that buyers take a more proactive approach rather than waiting for optimal prices to come to them. “What we’ve seen is direct response advertisers get much more involved in the planning of their campaigns as opposed to waiting around for remnant inventory that really doesn’t exist these days,” he says.
Developing a multi-channel campaign is a good approach too, but Fays believes that it all comes down to the type of product and the target audience. “For a lot of the ad campaigns that MTV Networks has, I would definitely say they should have a pretty large online component because our viewers are young, they’re hip, they’re on their computers all day,” he contends.
However, high-traffic sites can be just as pricey as premium spots on daytime TV.
“MTV.com and VH1.com are very expensive sites that most DR clients are probably not going to want to buy,” says Fays. “So when they come to us, they look for sites that are little more efficient. There’s not as much visibility but they’re going to get the eyeballs that they want.”
U.S. Hispanic Marketing Opportunities
The U.S. Hispanic market continues to grow exponentially in size and relevance. There are an estimated 50 million Hispanics living in the U.S., about 15 percent of the total population, with an estimated purchasing power of $1 trillion. While many ad budgets shrank throughout 2008 and 2009, Spanish-language cable TV had the highest increase in ad spending, according to a Nielsen report in December 2009.
Krigsman and Rubin recognized the opportunity and developed Hispanic MediaWorks, a division of Cross MediaWorks that provides a full-circle opportunity to take products from the English to Hispanic market and vice versa.
“Our feeling is that all demographics are to be served through media and our job is to connect marketers to the different consumers that they’re trying to reach,” says Krigsman.
They believe that there are other ways to target Hispanic viewers in addition to the major Hispanic networks. “We believe that the Hispanic viewer watches television very much like any other viewer,” says Krigsman. “They might be interested in sports programming. They might be interested in documentary programming. They might be interested in news programming. So when we create Hispanic marketing campaigns, we do it by targeting the audiences that that product is targeted towards, not just hoping that they’re going to be at one of the two places that everybody typically thinks of when they first think about the Hispanic market.”
He adds, “We’re really going to be excited when the Census comes out and we’ll be able to show that much more of an audience that’s available for these marketers.”