TSMS has become the first ITV sales house formally to offer volume
discount on ratecard, just two months after first pushing for the move.
The sales house is now offering agencies different discount levels for
commitments of pounds 5 million and over.
The other two ITV sales houses, Carlton UK Sales and Laser Sales, have
decided not to formalise the concept by offering ratecard deals.
However, they are prepared to incorporate volume discounts into their
agency discussions.
TSMS initiated the move in a bid to keep advertisers loyal to the ITV
network in the face of the launch of Channel 5 and the seepage of
revenue to satellite and cable channels.
The drive comes amid pressure from certain agencies to change the way TV
is traded by incorporating volume discounts into deals. Jerry Buhlmann,
managing director of BBJ Media Services, has called for volume discounts
based on spend thresholds (see Opinion, p25).
However, most observers believe Laser and Carlton are more focused on
their share of ITV than TSMS and are unlikely to follow its lead.
Paul Parashar, broadcast director at New PHD, said: ‘We would applaud
TSMS’s move to resurrect volume discount but the mechanism will only
work if it offers further discount rather than being part of existing
discount.’
Bill Barker, broadcast director of J. Walter Thompson, added: ‘Share of
broadcast is more sensible for ITV. It’s easier for advertisers and
agencies to embrace share rather than volume.’
Separately, Jerry Hill, chief executive designate at TSMS, is looking
for a number two to take a lead role at the sales house. Hill moves up
from managing director on 1 January, when Tim Wootton becomes chairman.
