TV TIE-UPS IN THE DIGITAL AGE - With digital TV on course to create a flood of channels, Meg Carter looks at how ad agencies could use this opportunity to fund the production of entire TV shows as a branding exercise

Wilkinson Sword, Marks & Spencer and Western Union are the latest additions to a growing list of advertisers keen to be more closely involved in television programmes. These brands, and others, are now testing the waters of advertiser- funded TV. Not for them broadcast sponsorship, with the chance to buy an on-screen association with a show once it’s been made and is about to go on air. These companies want to go one step further: investing directly in production, or even developing and producing their own programming to sell to channels in the UK and elsewhere.

Wilkinson Sword, Marks & Spencer and Western Union are the latest

additions to a growing list of advertisers keen to be more closely

involved in television programmes. These brands, and others, are now

testing the waters of advertiser- funded TV. Not for them broadcast

sponsorship, with the chance to buy an on-screen association with a show

once it’s been made and is about to go on air. These companies want to

go one step further: investing directly in production, or even

developing and producing their own programming to sell to channels in

the UK and elsewhere.



The catalyst, it seems, is the advent of digital broadcasting. The

increased broadcast capacity digital will deliver means more TV channels

and more demand for programming. Increased supply of TV, however, looks

set to further fragment audiences. This will put greater pressure on

broadcasters’ budgets, threatening a funding shortfall for TV

programmes. Meanwhile, increased supply of channels will lower the entry

costs for those wishing to move into production. Step forward, then, the

advertiser funder.



Many believe that advertiser funders can provide broadcasters and

producers with a new source of production funding and programming. In

return, advertisers can be more closely involved in the types of

programmes made and individual productions, gaining production and

scheduling information ahead of their rivals and the chance to use

programmes as part of a broader marketing strategy.



These advertisers can get involved in making programmes in a variety of

ways. Some, such as Procter & Gamble, Unilever and IBM, have become

involved with programmes sold to broadcasters around the world while

others, such as Pedigree Petfoods and British Telecom, have focused on

their local, domestic market.



An advertiser funder might choose to co-fund the development of a

programme in return for an on-air credit. If that programme is then

distributed internationally, the advertiser can benefit from bartered

airtime in some markets, or a share of the cash paid by the broadcaster

in others. Alternatively, it might choose to put up development money to

get a programme developed to pilot stage.



At the opposite end of the spectrum, it might provide 100 per cent of

the funding, effectively commissioning the programme itself which would

then be sold to a broadcaster. There is now even talk of advertisers

funding entire channels of programming and the first brand-owned,

interactive digital services are due to launch in the UK later this

year.



The importance of advertiser funding is acknowledged by a small but

growing band of brand owners, media specialists, independent production

companies and even broadcasters. However, many ad agencies are lagging

behind, with the notable exceptions of Grey International, Lintas

Worldwide, Saatchi & Saatchi and Lowe Howard-Spink.



According to Simon Lowden, the marketing director of Pepsi - which is

behind The Pepsi Chart Show, one of the highest profile

advertiser-funded programmes of recent months - advertising agency

reaction so far is ’sad’ and ’arrogant’. ’Too few agencies want to be at

the heart of their clients’ businesses,’ he says. Too many just don’t

see advertiser funding or broadcast sponsorship as important enough.



’There seems to be a residual fear that (advertiser funding) is

something agencies have less expertise in, have to share power with

someone else to do and costs less so they’ll lose budget,’ Tess Alps,

Drum PHD’s executive chairman, says. ’Everyone is costing it versus

mainstream broadcast costs but that equation will never work - it always

looks expensive.’



Jon Wilkins, the director of Creative Communications, an affiliate of

New PHD, adds: ’A lot of creatives able to control creativity over a

30-second ad would feel deeply uncomfortable creating for half an hour.

If I were a client, I’d definitely be interested in harnessing the

digital TV environment. Already, there’s a lot of interest. But ad

agencies, as they stand, are companies of the past, not the future.’



Look at the driving forces behind recent advertiser-funded programme

deals and few come from traditional, full-service ad agencies. In some

cases, the advertiser has pushed the deal through in spite of its

agency. In others, brand owners have worked directly with sponsorship or

media specialists. In a few cases they’ve even become involved following

a direct approach from a production company.



Greg Delaney, the chairman and joint creative director of Delaney

Fletcher Bozell, is cautious - a typical attitude in the industry. ’It’s

certainly appearing on the agenda, now,’ he says.



’But I’m unconvinced it is an effective use of an advertiser’s budget.

Regulations in the UK stipulate you can’t feature the advertiser’s

product in the programme so it seems a very imprecise form of marketing

if you can only sell the generic values of your product. And this at a

time when there is a general drift within media and advertising towards

greater precision and ’smart targeting’ - it doesn’t stack up.’



James Ringshall, the vice-president of international media at Universal

McCann, says: ’We’ve not done a great deal of it to date. We are a

European operation and advertiser-funded programming is an American

phenomenon.



There’s been little here, as far as I’m aware. If you are a food

company, why get into programming when the one thing you are good at,

and have a track record in, is making food?’



Besides, advertiser funding is hard to evaluate, Delaney says. And it

risks alienating the viewer. Few would welcome ’blatant commercialism’

within editorial, he points out, painting a nightmare scenario of

advertising messages dressed up as half-hour programmes. ’Current

regulations may be restrictive but they offer good protection,’ he

adds.



Criticisms are regularly levelled at advertiser funding by those not

involved in it, describing it as ’imprecise’, ’over-regulated’,

’immeasurable’ or ’un-British’. Yet, its advocates maintain, if used

correctly, it can - and does - provide a tangible return. To date, there

have been more than 30 advertiser-funded programmes made in the UK and

many more broadcast on British TV.



’Some advertisers are looking for international productions, others are

coming to us for UK ideas . It is definitely an area we are seeing more

people moving into,’ says Trish Kinane, the director of programmes at

the production company, Action Time, whose quiz show, Raise the Roof,

was funded by Express Newspapers. ’We’ve got to find new ways of funding

programming with all the new channels due to launch on air.’



According to Wilkins, there are three core benefits: the ability to

ensure the type of programming made will directly appeal to an

advertiser’s target consumer; the opportunity to lay a larger commercial

imprint on to the con-sumer; and the potential to own and exploit TV

rights.



The director of Sponsorvision, Jon Marchant, adds bluntly: ’The key

benefit is that people watch programming, not commercial breaks.’

Research into viewer attitudes to broadcast sponsorship shows audiences

view them positively, as many believe the sponsorship has actually

contributed to the cost of production, he says. In the UK, where most TV

sponsorships are negotiated after a programme has been made, this is not

the case. Even so, it reflects the positive ’halo effect’ an advertiser

funder can enjoy.



Advertiser funders tend to use advertiser-funded programming in one of

three ways: to more fully exploit an existing asset, such as an event

sponsorship as in the case of Schweppes’ Eurobaschhh; to promote a

particular set of values relevant to the brand, as was the case of

Pepsi’s involvement in The Pepsi Chart Show; or as a straight investment

- an approach limited to the biggest advertisers, such as Procter &

Gamble, which has its own TV production division and has invested in a

range of top TV series, including Northern Exposure.



Those using advertiser funding for promotional purposes (in other words,

the majority of advertiser funders, to date) must tread warily as

regulators, particularly the Independent Television Commission, have

firm restrictions on the degree of product promotion allowed within

broadcasted programmes. Undue prominence of a funder’s product within

the programme is widely banned. There are limitations relating to on-air

branding and clear guidelines on programme credits.



Such restrictions, however, protect the advertisers’ interests as much

as the viewers’. The advertiser must balance its interests with those of

the producer and broadcaster who must all work in partnership to get the

advertiser-funded programme on air. Neither producer nor broadcaster

want programmes of poor quality, programmes likely to alienate an

audience or break codes of conduct. And, by the same measure, neither

does the advertiser funder.



Advertiser funding is a high-risk activity and the failure rate is

high.



There are a number of reasons for this. Not only must the advertiser

have a clear focus on what it hopes to achieve, it must also balance its

objectives with those of its partners. The most common causes of failure

are unclear goals, poor communication between partners, and advertisers

who fail to leave programme-making to the programme makers.



In spite of this, there is a growing belief it will become more

commonplace.



’The opportunities are fairly limited in Europe because media owners

don’t need it - there is a limited number of channels and an over-supply

of programming,’ Ringshall says, although he admits: ’When it all goes

digital, this will undoubtedly change.’



The Campaign Guide to Advertiser-Supported TV Production, by Meg Carter

and Andrew McCall, is published by Haymarket Reports in September



RECENT DEALS



MARKS & SPENCER



In July, Channel 4 confirmed plans to team up with Marks & Spencer in

its first foray into TV production: a history of Britain shot from the

air. The seven-part series of 30-minute programmes will air as part of

the channel’s schools service. M&S is understood to be putting up 60 per

cent of funding in exchange for rights to archive footage which it will

distribute on video.



WILKINSON SWORD



Wilkinson Sword plans to fund a sports series, Pirate TV, to be produced

by Meridian for ITV. The deal, announced in July, is for a 13-part

series made up of 30-minute programmes featuring extreme sports and was

brokered by Universal Sports Marketing. Pirate TV will be seen first on

ITV then broadcast internationally from November onwards.



WESTERN UNION



Earlier this year, Western Union funded Western Union Football - a

weekly football magazine series featuring news and coverage of local

teams in territories where Western Union’s money transfer business is

most strong.



The series was developed with DMB&B and its sports marketing subsidiary,

Premier Marketing, and has been shown in the UK on ITV and in more than

140 countries worldwide.



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