Branded integration comes to local TV

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In an era when local broadcasters feel financially squeezed from nearly every direction, an Oklahoma City TV station has turned to an old-fashioned programming strategy to make some new-style money. And the product-integration model could become a blueprint for other stations, becoming a secondary revenue stream outside the $17.3 billion spot TV advertising market by luring in small local advertisers more acclimated to newspapers and yellow pages.

Hearst-Argyle-owned ABC affiliate KOCO-TV generated more than $100,000 in profit from its recent locally produced special "Oklahoma's Ultimate Makeover," in which women underwent plastic surgery to achieve a new look. (The national ABC network airs both "Extreme Makeover" and "Extreme Makeover: Home Edition.") With the concept, the station brought in several advertisers-local Lasik doctors, plastic surgeons and cosmetic dentists-who don't typically buy on-air spots. The show was a chance to lure them to the station and generate "nontraditional revenue," said Dominique Homsey Gross, sales marketing manager for the station. "The sponsors that did all of the work [on the women] pay to be part of the show."

In addition to Oklahoma University Medical Center, Smile Solutions and TLC Lasik Eye Centers, other sponsors included a local hair salon, a spa and a body-toning center.

While national cable and broadcast networks often require an advertiser to place media buys to be integrated into a show, KOCO does not. "The majority of our nontraditional revenue has nothing to do with spot buys," Ms. Homsey Gross said.

UNTAPPED NICHE

This style of programming allows local advertisers to participate in a bigger way than they can through 30-second spots, said Gordon Borrell, president of Borrell Associates, a research and consulting firm focusing on local media. After all, a local plastic surgeon isn't going to find a brand-integration opportunity with a national network.

"[Local programming] is a wonderful untapped niche that all broadcasters ought to be pursuing," Mr. Borrell said. "You will find a lot of advertisers that are tired of buying lots of 30-second spots or a handful of 3-by-5s in a newspaper, and a chance to integrate into a program makes sense. This is a way for particularly the bigger advertiser to be a part of something exciting rather than just run adjacent."

Chris Rohrs, president of the Television Bureau of Advertising, said a success story like KOCO's could open the floodgates for other local broadcasters to pursue similar advertising opportunities. "The emphasis on developing new revenue has been shifting to local and this falls into it. Local programming has always been and will always be a unique differentiator for broadcast stations." "Ultimate Makeover" is the first local show he's seen involving product integration, but he expects more in the same vein.

The program chronicled two Oklahoma women who went under the knife to have their faces, eyes, eyebrows, noses, lips, breasts and cheeks redone and was the highest-rated locally produced entertainment program in Oklahoma City history, said Matt Laws, creative-services director at the station. It generated an 8.4 household rating and a 12 share March 23 and a 6.2/10 on its encore presentation two nights later, according to Nielsen Media Research. About 219,000 people total watched the show, exceeding expectations.

On the Wednesday night first episode, the show aired at 9 p.m. Central Time, pre-empting "Wife Swap," which has averaged a 7.0 household rating. But KOCO replayed "Wife Swap" over the weekend. "Oklahoma's Ultimate Makeover" marked the first time the station has pre-empted prime-time programming for a locally produced special.

"It's pretty brilliant, taking a national idea and localizing it that way," said Jean Poole, exec VP-chief operating officer, North America, of Universal McCann. She said she expects other local stations to follow "and generate new revenue that way."

Based on the ratings and financial success, KOCO has begun planning the second installment of "Oklahoma's Ultimate Makeover" with the next casting call slated for May. The show is to air sometime in the summer.

The station is also prepping for a local twist on another ABC show when it runs "5's Home Team" in late June. The half-hour show, inspired by ABC's "Extreme Makeover: Home Edition," will feature a local family getting its home redone. Local advertisers integrated into the KOCO show are furniture companies; siding, flooring and roofing purveyors; and audio and home-theater suppliers and construction firms, Ms. Homsey Gross said.

"Even though the concept has been done before, we do it a little differently," Mr. Laws said. "We go more into the story of the family and the depth of Oklahoma. We are trying to showcase that Oklahoma has phenomenal plastic surgeons, phenomenal construction companies."

Other Hearst-Argyle stations are expected to follow KOCO's lead and introduce more local programming. Many already do. Hearst-Argyle's ABC affiliate in Milwaukee, WISN-TV, has garnered strong ratings for its locally produced newsmagazine "On Assignment." The group's NBC station WLWT-TV in Cincinnati has crafted local specials on the Busch Series auto races, while CBS station KCCI-TV in Des Moines, Iowa, has created local weather specials, said Marv Danielski, VP-marketing and creative services for the station group.

He said Hearst-Argyle stations are not looking to pre-empt their syndicated shows, but will look for appropriate opportunities to offer more locally produced content.

Brent Hensley, president-general manager of KOCO, said local programming is a necessity for stations. "It's our obligation as local broadcasters. We are given the opportunity and the obligation to serve our local communities, and the network may not always fulfill that obligation, whether for sports or news," he said.

This summer KOCO will invite sponsors to join its "On the Road" promotion when it takes its newscasts into various Oklahoma communities as another way to generate nontraditional revenue.

"You will see a lot from KOCO and new ideas and new concepts coming around the pike," Mr. Laws said. "We will be the most aggressive station in Oklahoma and probably one of the most aggressive in the country. ... This is definitely a new revenue stream for us that has proven to be profitable for the station and the partners."

This story first ran in TelevisionWeek; Daisy Whitney is a contributing writer for that publication.

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This style of programming allows local advertisers to participate in a bigger way than they can through 30-second spots

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