Exclusively at Kroger
The network has signed an exclusive advertising deal with Salt Lake City-based In-store Broadcasting Network and Cincinnati-based Kroger Stores that shuts the other major broadcast networks out. The deal came out of ABC's marketing group, and Mike Benson, senior VP-marketing, said he's been trying to put his network's programming into grocery stores for five years, but it's taken that long for the technology to catch up and the cost to come down.
"I've always thought the grocery store is a really appropriate place for a broadcaster to market its programming and offer other content," he said. "It offers recency. People are pre-disposed to going home, cooking dinner and turning on the TV set."
The exclusivity agreement does not cover cable stations, and IBN could still strike deals with a network such as CNN, said Lon von Hurwitz, IBN's exec VP-business development and retail relations.
Ultimately, the deal is a promotional one. ABC is spending money with IBN but is also getting additional ad time and exposure for the content it is providing. Mr. Benson said he doesn't intend to air just promos for shows but will try to create custom programming to fit the environment. It could be some of the "Desperate Housewives" greeting shoppers or TV trivia or home and shopping tips from ABC stars. It includes primarily entertainment programming but ABC is considering bringing news and daytime programming into the mix.
It's not the first time a TV network has advertised on in-store networks -- but Mr. von Hurwitz said the deal's exclusivity serves as a model for IBN's future deals with national brands.
"We want to provide some clarity in the in-store space that you don't have in the television ad medium, where's there's a whole lot of confusion, with a Coke spot followed by a Volkswagen ad, followed by Pepsi and then a GM ad," he said. "We are carving out a world for ABC to have a clear message to consumers."
Premier Retail Networks, the company behind Wal-Mart's in-store advertising system, has approached the networks differently.
No exclusives for Wal-Mart
"We are not striking exclusive deals on any of our networks," said Genet Garamendi, a spokeswoman for Premier Retail Networks. "Instead we have content deals with most of the broadcast and cable companies in the industry," such as NBC, Discovery and Oxygen.
"In some cases, yes, if a broadcast company like NBC wants to promote shows on its new fall schedule, they advertise with us," but PRN will not shut out ABC from doing ads at the same time, she said.
"You can argue that as new media comes along it's going to dilute some of your own dollars, so are you contributing to the competition?" said Mr. von Hurwitz, but the former director of marketing for ABC radio recalls spending plenty advertising radio on TV. "All that really matters is building an audience and that's what ABC wants to do here."
And while ABC is mining the aisles to find viewers for its fall schedule, NBC is reaching for the skies -- creating a special custom publication with Pace Communications that will run in the September issues of Pace's in-flight magazines, United Airlines' Hemispheres, Delta Air Lines' Sky and U.S. Airways Magazine.