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HALLMARK CHANNEL REVAMPS MOVIE AD STRATEGY

Seeks Exclusive Sponsors; Reduces Commercials to Four Minutes an Hour

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NEW YORK (AdAge.com) -- Hallmark Channel heads into this year's TV upfront ad auction with the intention of selling fewer ads and offering exclusive sponsorships for its signature movies.
Hallmark Channel offers a number of original movie series such as 'Mystery Movies,' starring John Larroquette, Kellie Martin and Lea Thompson.

Four minutes per hour
The channel said it will interrupt its sponsored movies with only four minutes of advertising each hour.

"We hear it all the time that advertisers are really worried their messages are being zapped or skipped or not given any attention," said Bill Abbott, executive vice president of national advertising sales for Hallmark Channel. "Entitlements not only provide them an opportunity to associate with our brand but also to break through the clutter."

According to strategic media auditor Media IQ, TV movies typically have the highest commercial inventories and heaviest spot loads, with as many as 20 minutes of commercials per hour. Mr. Abbott said Hallmark's typical commercial inventory during movies is 12 minutes.

Do more at upfront
He said Hallmark has had a number of conversations with interested clients regarding upcoming entitlement opportunities but that how many they sell in the upfront "will depend on the marketplace. It's our intention to do more, not less, than last year."

The network struck 10 entitlement movie deals last year with advertisers such as Kraft, SC Johnson, Pfizer, Schering-Plough and Johnson & Johnson. According to the network, the ratings for those commercial-reduced movies jumped 32% over Hallmark movies running with a normal commercial load.

Bob Liodice, president-CEO of the Association of National Advertisers, highlighted the clutter subject in his keynote address at this week's Television Advertising Forum.

"Increasing levels of clutter do nothing but undercut the cornerstone principle that the rest of the marketing world seems to get -- that consumers want more content and less advertising," he said. "Clutter has been increasing every year and is at historic proportions."

Reducing clutter
While clutter cutting is a hot topic, the idea of advertisers' sponsoring commercial-free or reduced-commercial programming isn't new. However, such isolated deals have been more common on broadcast rather than cable networks, said Mike Lotito, CEO of Media IQ.

"I applaud anyone who's reducing that clutter and helping advertisers connect to the audience," he said. "And if I was an advertiser, I'd pay a premium for that. At some point it's got to equate to a higher cost-per-thousand [viewers]."

Mr. Abbott wouldn't disclose how much higher sponsored CPMs run, though raising those rates is a primary goal of the push. He did say it's a "significantly different number when you're taking an ownership position."

Denies sales slowdown
Cynics say that Hallmark Channel, which is in 68 million homes, may be offering the entitlements out of an inability to sell out its commercial inventory at its desired CPM.

Mr. Abbott denied that.

"Our spot level has been extremely high for the past few years," he said, citing this year's upfront goal of $110 million. "And this has everything to do with how we want the channel to look and operate and the kind of experience we want viewers to have."

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