Close-Up: Live Issue - Is Champions League ad fee justified?

Are Champions League final advertisers getting what they're paying for? Caroline Lovell reports.

There are, apparently, only three sports that matter in the UK: football, football and football.

So it was no surprise, after England had failed to qualify for Euro 2008, that fans across the nation waited with bated, lager-fuelled, breath to see if any English clubs would make it to the Uefa Champions League final in Moscow.

With three teams in the running at the semi-final stage, at least one English representative was guaranteed a place. But ITV and Sky, which own the broadcast rights, would have been celebrating even harder after both Chelsea and Manchester United got through.

In the first-ever all-English final, many accept this is a game that holds a premium.

And it is a premium that ITV has grabbed on to with both hands. After the finalists were revealed, ITV raised the price of its TV ad slots by up to 50 per cent. This meant clients were coughing up around £200,000 for a 30-second ad. And, according to industry sources, that figure had increased again by a further 15 per cent within two days.

Although ITV declined to say how the rates compared with last year's final between Liverpool and AC Milan, Gary Digby, the customer relations director at ITV, did admit they were up.

Gary Leih, the chairman and chief executive of Ogilvy Group UK, says: "ITV hasn't had very much to smile about in the last couple of years, so the first-ever all-English Champions League final represents an opportunity for it. Who can blame it for taking advantage of a surge in interest?"

Digby hopes around 13 million viewers will switch on to the game, excluding the out-of-home viewing in pubs, compared with four million in 2004, the last final without an English club involved.

So far, Sky has Audi, Ford, Nike, Samsung and Pepsi on board, and, although ITV declined to comment for fear that competitors would try to hijack the campaigns, it is understood that Ford, Audi and Nike also have slots booked up during the match on ITV.

Ed Elworthy, the head of brand connections at Nike UK and Ireland, says: "We can legitimately expect a strong ratings result, given that it is an all-English final, and also appreciate the premium associated with such a huge event. They can charge what they want; no brand is forced to buy ad slots."

At the time of writing, ITV had a few slots left to sell, but Digby stresses that this is a good situation, as advertisers will get more interested and the price will increase as the pre-game hype builds up.

With ad slots reputedly going for up to four times the normal price of a premium ad during a high-rating show on ITV, Digby says clients will always accept a value above normal programming for a premium, one-off, prestigious sporting event, or the final of a high-rating show such as Britain's Got Talent.

With only one category allowed in each ad break, competition is fierce and secrecy a must. Ford and Nike have created new ads for the final: Ford has hired the Sony Bravia "balls" director, Nicolai Fuglsig, while a Nike spokesman says cryptically that its ad will feature Premier League, FA Cup, Champions League and European Championship milestones.

It appears that the value of communicating with around 13 million people in one swift shot supersedes any price tag - particularly when you are targeting blokes who are traditionally hard to reach.

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AGENCY HEAD - Gary Leih, chairman and chief executive, Ogilvy Group UK

"Although advertising is primarily a creative business, it's still a business - and businesses are driven by markets, by the rules of supply and demand.

"After all, this competition has the potential to deliver large and high-quality audiences. One of our clients is a major sponsor of the Champions League tournament and is unveiling a campaign for a new product during the half-time break. I suspect they would be willing to pay a premium to ensure they retained that slot - it's the kind of audience they want to reach.

"It's still a buyer's, rather than a seller's, market, although, as ever, you get the audience you pay for."

MEDIA OWNER - Gary Digby, customer relations director, ITV

"Big sporting events will always be sold at a premium. If we can't sell Chelsea and Manchester United at a different price, then we should pack up and go home.

"Premium sport events have a value over and above normal programming or scheduling, and the market accepts this value or finds a rate it accepts. We don't try to overcharge; we set it at a reasonable price.

"The ability to communicate to 13 million people in one go is quite compelling. Advertisers are prepared to pay because of the unique audience. I don't think anyone thinks it is unreasonable."

MEDIA AGENCY HEAD - Phil Georgiadis, chief executive, Walker Media

"This is a genuine case where the level of prestige and audience is definitely worth a substantial premium.

"At the end of the day, we operate in a market. It seems to me that ITV can sell it at whatever price they can sell it at.

"But there are lots of egos at stake in something like this, a lot of testosterone flying around. For some advertisers, it's a battle of wills between one car ad and another, one beer against another. The egotistical demand hardens the rate and ITV is the beneficiary of that. That's competition."

CLIENT - Chris Hawken, brand communications manager, Audi

"This year's final holds even more weight because England failed to make the Euro 2008 competition. So, for footie fans, it's the only footie-porn they'll get this year.

"I don't support the price hikes, but we can slightly understand why they have done it. It's very hard to reach our target audience, and this achieves that in a pure event-driven advertising environment where people are having a good time and are receptive.

"There is huge demand for the ad slots. But the environment is perfect. It is always a balance between paying for one of these spots or week after week on Grand Designs."