Media Forum: Is TV failing regional clients?

Will dropping some micro regions worry advertisers, Alasdair Reid asks.

As media earthquakes go, this was arguably a tremor. ITV, as revealed in a letter to agencies and clients from the group commercial sales director, Gary Digby, plans to offer fewer micro regions to advertisers.

As of 1 January 2011, for instance, you will only be able to buy Tyne Tees as a single region, in stark contrast to the current situation where you can, if you wish, choose between the areas served by the Bilsdale and Pontop Pike transmitter masts.

Similarly, advertisers in the Meridian region will no longer have the option of micro-targeting Kent or Sussex. Anglia North and Anglia South are being axed too - though it will still be possible to buy Anglia West and Anglia East (not to be confused with East Anglia, which exists largely as a state of mind).

Those whose regional prejudices vie only with their ignorance in such matters might be forgiven for assuming that the loss of the Pontop (nearest town, Consett, County Durham) micro region could be regarded as a tragedy only by local suppliers of sheep-dog biscuits. Or, indeed, the legendary local shop on the outskirts of Royston Vasey.

But the issue is threatening to brew up into a hot little row - Recognition Marketing, of Darlington, has written to Ofcom and the Office of Fair Trading to express its anger.

And, come to think of it, doesn't this go against the grain of the whole targeting revolution that new technologies were supposed to bring? ITV's rationale is that the micro-region cuts are needed precisely because it is moving "further into the digital spectrum". This is not quite as exciting as it sounds - it's just another way of saying that it needs to buy more transmission bandwidth in order to distribute ITV1+1 and ITV1 HD.

But this digital excuse serves as a reminder that, not so long ago, many in the marketplace were speculating about a technological future in which TV advertisers would soon be able to target right down to individual households.

All of that is still on the agenda, Jason Spencer, the managing director of PHD North, points out. BSkyB's proposed Adsmart system will offer fully addressable advertising down to a micro level, where specific postcodes can potentially be targeted alongside buyer behaviour. And YouView, the newly revealed brand name for Project Canvas, will also offer greater targeting opportunities.

Spencer says: "This is the promised land for advertisers. If Sky and the YouView consortium can deliver the opt-in audiences and a profitable model that advertisers can afford, we'll be transported from macro TV regions to digital micro-targeting."

On the other hand, Charlie Varley, the managing partner at Media-Vest Manchester, argues many local advertisers may have lost faith in what TV can do. He adds: "It's all too difficult and expensive - and they tend to put more resources into a digital play. At a local level, the web is replacing TV.

"The world has changed. These days, TV is all about global advertisers. If you look at the high streets of most towns with a population of more than 70,000, almost all the shops are part of multinational chains."

Yet Mike Parker, the head of strategic sales at Channel 4, confirms that the broadcaster has no intention of diminishing its current regional commitments. It offers six macro regions: Ulster, Scotland (which embraces the Lake District too), North, Midlands, South and London. But he says he has sympathy with ITV: "ITV's regional situation is there because of historical reasons - the franchise structure established in the 60s and 70s. It bears no relation to real marketing regions and it makes no sense from a cost-analysis point of view.

"I can see why agencies in particular may be upset because they might feel they have limited options. But I think we would agree that there seems to have been a move away from regionality where advertisers are concerned."

Absolutely, Adrian English, the head of broadcast at Carat, agrees.

"Obviously there's a commercial rationale to what ITV is doing. We live in a global world - and you can argue that if the micro region demand was there, ITV would be meeting that demand," he says.

"At the same time, it has obligations to its viewers and to advertisers. So this will have an effect on the local communities involved. Longer term, though, where the broader question is concerned, BSkyB will be important in this whole equation - because it's soon going to be able to offer the option of targeting geographically, right down to individual streets or houses."

NO - Jason Spencer, MD, PHD North

"TV is evolving but ITV's - and Channel 4's to a lesser extent - regional macros still deliver for many regional, if not local, advertisers. Irn-Bru's use of Scottish TV with quality programming and efficient targeting is an example of this."

MAYBE - Charlie Varley, managing partner, MediaVest Manchester

"Local clients will default to the web. It's about getting your message in front of a pre-qualified audience as efficiently as possible. TV has become broadcast in a true broadcast sense."

NO - Mike Parker, head of strategic sales, Channel 4

"As broadcasters migrate on to online distribution platforms, the opportunities will come for advertisers to buy at a post-code or IP address level. That form of regionality will become a far bigger part of TV."

MAYBE - Adrian English, head of broadcast, Carat

"You have to recognise commercial realities. Equally, though, there will be people who think they are not being served by the UK's biggest commercial broadcaster. There will be those who feel that ITV has a greater obligation to local viewers and advertisers."

- Got a view? E-mail us at campaign@haymarket.com

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