Forum: Will a macro sell help halt adspend sliding south?

The North may be buoyant, prosperous and happening, but television advertisers remain unimpressed. Ward Thomas, chairman of Yorkshire Tyne Tees Television, thinks a Northern macro sales set-up could reverse the drift of cash to London. Is he right? Or is the problem more deep-rooted? Alasdair Reid investigates.

The North may be buoyant, prosperous and happening, but television

advertisers remain unimpressed. Ward Thomas, chairman of Yorkshire Tyne

Tees Television, thinks a Northern macro sales set-up could reverse the

drift of cash to London. Is he right? Or is the problem more

deep-rooted? Alasdair Reid investigates.



Everyone knows by now that the North is resurgent. There’s branch of

Harvey Nichols in Leeds for a start. And then there’s ... well, plenty

of other stuff happening up there. Probably. It’s no longer about

whippets, the allotment and bingo at the working men’s club.



The North, in short, is now wall-to-wall Harrogate - or will be when

they’ve persuaded all those clubs in South Shields to stop selling

suicidally strong ale at 20p a pint. If you don’t believe all this, talk

to Ward Thomas, the chairman and chief executive of Yorkshire Tyne Tees

Television.



Announcing YTT’s financial results last week, he said that, in

advertising sales terms, his region was not realising its true potential

(Campaign, 21 March).



Historically, Yorkshire used to take around 14 per cent of ITV

revenue.



The figure last year was 10.31 per cent. This is an old battle cry from

Thomas - YTT happens to be sold by Laser Sales, which is owned by

Yorkshire’s traditional enemy, Granada. It has looked at trying to take

over Yorkshire in the past and what better way to set up a sale than by

underselling the station and depressing the share price?



Last week, though, witnessed a departure from such parochial

infighting.



Ward Thomas was acknowledging that the ad sales slide is a problem faced

by all of the Northern stations. The prosperity may be there, so are ITV

audiences, but advertisers and agencies remain unimpressed. The North

needs a fresh approach - and the solution, according to Thomas, will be

to sell it as a ’macro’ region.



Laser is happy to oblige - in fact, it has been working on such a

proposal for several weeks now and has Independent Television Commission

approval for the initiative.



But will it work? The problem for the North - and for all but two of the

ITV contractors - is the fact that London is so strong these days.



Growth sectors, such as financial services and telecoms, target the

capital first and let the provinces scrap for the crumbs. Could a macro

sell reverse this structural trend?



There has been a history of competition between Yorkshire and Granada,

as Mick Desmond, the chief executive of Laser, readily admits. ’Agencies

still try to drive a wedge between the two stations. A macro approach

would put an end to that.’ He adds: ’The North came out of recession

first and people there have more disposable income these days. We will

remind people that 25 per cent of the UK population is covered by the

macro region and we will also make life easier for the buyer - for

national advertisers, one spot will cover the whole of the macro

region.’



Desmond says the great irony is that advertisers are being persuaded to

use alternatives that actually cost them more: ’These alternatives seem

cheaper against the price for all ITV but not against the Northern

stations, which continue to offer better value. That fact is being

disguised at present and it is something we have to get across.



’Around 65 per cent of business currently is common across the three

regions and a very high proportion of advertisers are capable of

advertising across the whole of the North.



And of course there will be incentives - they will be different to the

way that they are structured cur-rently within Laser. We are not seeking

to prevent anyone using individual regions as they see fit but we will

try to reward them for using the macro,’ he reveals.



That will come as a surprise to John Blakemore, the UK advertising

director of SmithKline Beecham. ’I can’t really see how they could

introduce an attractive new form of incentive,’ he states. ’The reality

of the way that television is traded would make that very difficult to

do. There are already various opportunities within Laser. I take it that

you could still easily opt out of the macro and buy Granada, for

example, on its own, without problems. So what’s new?



Blakemore points out that for advertisers, one of the most important

factors is achieving the right balance of audience delivery. ’I don’t

think that the initiative would necessarily make them want to change

that.



So whether it works or not will depend on what sort of advertiser you

are and how the constituent parts of the marketing strategy fit

together.’



Blakemore is not alone in being confused. Alan James, the TV buying

director of the Network, also struggles to understand what will be new

’There certainly won’t be any dramatic benefit in administrative terms.

We no longer have every single spot with a monetary value against it -

it’s a one-line invoice these days. So that really isn’t an issue,’ he

says.



Anyway, that is irrelevant to the fundamental problems faced by the

Northern contractors, James says. ’In the past, fmcg stood for a greater

percentage of the total television market. Campaigns were aimed at

housewives and the North was a good place to go looking. There were also

lots of regional retail chains. That’s all changed. Lots of campaigns

are driven by equal impacts strategies these days and you don’t need to

pump a lot of revenue into the North to achieve your targets because the

airtime is so cheap.



It’s not a problem that incentives can really address - and anyway most

buyers are very cynical about that whole issue these days - they see it

rather as a series of dis-incentives for not using a region.’



Chris Boothby, the broadcast director of BBJ Media Services, is more

positive. He thinks the ITV macro will allow the network to compete more

effectively against the Channel 4 northern macro. ’For buyers, an easy

one-stop sell can prove attractive as long as individual brand marketing

requirements are not compromised. It must be remembered that the west

and east of the Pennines constitute two distinct marketing regions,

often with different needs and requirements. It is fundamental that this

new macro sell is not prioritised above existing regional opportunities

in terms of both airtime access and quality. Given these parameters, and

provided that Laser doesn’t intend to enhance any potential conditional

sell, this macro could become a beneficial alternative to both

advertisers and Laser.’