Media: All about ... marketing Freeview

The digital platform is planning a mass-market drive.

When Malcolm Gladwell comes to update his anatomy of viral communications, The Tipping Point, he will have to add a case study. The original book, published in 2000, contains little analyses of obscure or neglected brands that started experiencing outrageous growth rates for no apparent reason.

Now he will have to write a new chapter, entitled "Freeview". Last week, DTV Services, the consortium that runs the UK's digital terrestrial TV platform, revealed that it has asked the AAR to help in a review of its ad arrangements. It is seeking to appoint creative and media agencies by September.

It's a relatively attractive proposition, although nobody's about to get rich on the back of it. Freeview spends next to nothing on marketing. It has a media agency, the OMD subsidiary M2M, which handles ad hoc projects (and which will repitch), but no creative agency.

True, it is holding this review so that it can get a campaign out into the marketplace in time for the prime Christmas shopping period, which begins ramping up in October. The spend, though, will remain modest. Sources say it may exceed six figures - though not by much.

But this is nothing new. Since rising out of the ashes of ITV Digital in October 2002, Freeview has never run a mainstream mass- market ad campaign. Its launch, by DFGW, was a repurposed BBC digital campaign, and while DFGW was retained as an adviser, it only turned out scraps of ad hoc work.

And yet, according to figures from Ofcom for the first quarter of 2007, Freeview is the UK's leading digital TV distribution platform, with its kit in almost 8.4 million homes. That keeps it ahead of BSkyB, which has just over eight million subscribers - although Sky will point out that there are also 885,000 Freesat households, making satellite as a whole the top multichannel distribution platform.

1. In the UK market, there are now more than ten million pieces of equipment able to receive digital terrestrial signals in people's homes. These include Freeview-branded boxes, old ITV Digital and ONdigital boxes, plus new TV sets with the necessary electronics already embedded. This last factor is helping to accelerate penetration.

2. Following the collapse of ITV Digital (it went into administration in March 2002), the BBC took a lead role in reviving digital terrestrial TV. It formed a consortium called DTV Services, with other members including the National Grid and BSkyB, which relaunched DTT in October 2002 under the Freeview brand name. ITV and Channel 4 joined DTV Services in October 2005.

3. With £99 boxes available in the shops in time for Christmas 2002, growth began to increase almost immediately, with about 300,000 units shipping across the last quarter, beating growth in new BSkyB subscriptions.

4. With sales running at about 190,000 a week, Freeview burst through the five-million barrier during Christmas 2004. The platform acquired a further boost in 2005 when ITV's three digital channels (ITV2, ITV3 and ITV4) joined, as did Channel 4's Film4 and E4 brands.

5. The contrast between Freeview and BSkyB in marketing terms was made even more stark with the arrival of James Murdoch as Sky's new chief executive in November 2003. He set ambitious new targets backed by generous marketing budgets. Total marketing costs in its 2004-5 financial year were £379 million, with advertising accounting for less than a third of that.

6. During 2006, according to Nielsen Media Research, Freeview spent £807,000 on above-the-line advertising, while Sky spent £17.6 million on ads for its digital platform alone. On top of that, there was a significant spend on specific channels and services such as Sky+.

7. Marketing analysts attribute Freeview's relatively advertising-free success to a combination of factors: BBC trailers for the corporation's digital output have always informed viewers that the new channels are available on cable, satellite and Freeview - so, in effect, only one brand is mentioned. Then there's the view that Sky's advertising sells the generic concept of multichannel TV - and canny viewers shop around for the best deal. In this context, the "free" part of Freeview is often compelling. Then there are the efforts of the retail trade; and last there is the cumulative effect of word of mouth.

WHAT IT MEANS FOR ...

CREATIVE AND MEDIA AGENCIES

- There will be significant interest in Freeview's media and creative accounts, not least because new-business machines always need feeding and these days no opportunity is ever too small - even for the most sophisticated of agencies. But they'll also value it as an opportunity to impress the constituent shareholders of Freeview's parent company, including BSkyB, the BBC, ITV and Channel 4.

- Unfortunately, they'll all want to know if it's really true that you can be successful without spending any money on advertising.

MEDIA OWNERS

- With the two rival pay-TV platforms, BSkyB and Virgin Media, continuing to squabble, Freeview's position as an honest broker can only be enhanced - as, indeed the actions of both Sky and Virgin seem to confirm. Sky wants to introduce pay-TV services on to Freeview and Virgin's new channel, Virgin 1, is being tailor-made for the platform.

- As Jonathan Webb, the managing director of Virgin Media Television, puts it: "Virgin 1 demonstrates our confidence in this platform and how far it has evolved. In the UK, Freeview is the fastest-growing platform - and doing more on Freeview is vital to growing audience and advertising revenues. This is exactly what we intend to do. With access to more than eight million homes, it offers us the ideal shop window to reach a wider audience, while introducing viewers to our unique Virgin approach and the first Virgin-branded channel. As we strive to cement Virgin Media Television's strategic presence across a mix of free, pay and on-demand platforms, Freeview remains a very important part of our future."

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1 Job description: Digital marketing executive

Digital marketing executives oversee the online marketing strategy for their organisation. They plan and execute digital (including email) marketing campaigns and design, maintain and supply content for the organisation's website(s).