The movement builds on a series of deals introduced last year as Court TV inked deals with Starcom, Mediaedge:cia, Carat and Magna Global that guaranteed viewers would boast a certain level of engagement as defined by the individual deals and The Weather Channel worked with MediaVest to find the best programming environments in which consumers recall and retain ad messages.
Some networks and media agencies have called it "smoke and mirrors" or "headline-grabbing PR ploys." Much of the skepticism stems from the ambiguity about the methodology and metrics used to craft the individual deals. But as TV struggles to prove its value in light of competition from its uber-accountable online competitors, expect to see more upfront deals going beyond the GRP.
With the fourth quarter behind them, the architects of the Court TV deal-Charlie Collier and Debbie Reichig from the network and a few top broadcast buyers-sat down with Ad Age reporter Abbey Klaassen to discuss what it means for the coming upfront selling season.
AA: Why are all of these deals cropping up now?
Andy Donchin, director-national broadcast, Carat: The right time actually could have been two or three years ago. Clients have been very vocal in asking us, "What is the return on investment on the money we spend on their behalf?" ... There's also been a commoditization of the cable product and we're trying to see exactly what's working for us, and how we should be spending our money.
Elizabeth Herbst-Brady, senior VP-director of broadcast investment, Starcom: In the last couple of years with some of the traditional dollars being shifted over to the Internet, which provides a little bit more real time accountability, it's refocused some of the more traditional media folks to say, "You know what, we need to get going on this" ... [and] from Starcom's perspective, this was the first time that a media partner was willing to collaborate with us.
Charlie Collier, senior VP-ad sales, Court TV: Clients who now report into the procurement side of the business have become disproportionately focused on proof of ROI, so it was a good time for that reason. ... And then from a pure cable point of view, in a world of relative parity, where the difference between the No. 5 network and the No. 25 network is a few tenths of a rating point on any given demo, it's ultimately a time to prove quality.
AA: Given all those issues, what's keeping others from doing similar deals? Is it the amount of work involved?
Lyle Schwartz, managing partner-research and marketplace analysis, Mediaedge:cia: Any time you add another variable into the mix, there's going to be more work. ... But it's the right kind of work because television's role in advertising media is more challenged than ever before. ... Television has to step up to prove itself to maintain its position in the media mix right now.
Ms. Herbst-Brady: My guess is, having been a former vendor, the hesitance of vendors to do it is a belief that the intention of the agency partners was to disprove the value of the media, where I think it's really to the contrary. It's not that we're looking to disprove it, we're looking to understand it.
AA: Has this changed the role of research in the negotiations?
Ms. Herbst-Brady: I would say that as opposed to being a function that has been used to looking at the past, research has really been brought more to the forefront, to be a part of our negotiating and understanding what we're doing as we're going forward.
Debbie Reichig, Court TV senior VP-sales strategy: [We've] moved some of the resources from the marketing side to the research side so that we do have enough money to spend on some proprietary research and this partnership and to staff up to actually do some of the more tangible work. And that's a major indication, as Elizabeth said before, that research is playing a much bigger role in the buying and selling process.
Mr. Collier: There was a deliberate shift about three years ago to shift maybe 40% more money from marketing over to research and we continue to do that. ... Rarely do people ask you to go further on [the marketing] side of the business. On the research side, it really has been, `How can you invest with us?'
AA: How will these deals influence this year's upfront marketplace?
Mr. Donchin: The `05-`06 upfront was a watershed year because the buyers drew a line in the sand and said, "You know what? We're going to take the emotion out of this, we don't need to buy every cable network, we don't need to buy every broadcast network, and we don't need to pay big CPM increases. We want to be with the networks that we think are pushing product out the door for us." I think it's going to be a long-term thing, where we're going to take firm stances and go with the networks that we think are moving the needle for us, and be a little more selective, and be a little bit better negotiators, more knowledgeable negotiators.
Mr. Schwartz: It may not happen tomorrow, maybe the next year, but there's a lot of stress on the television market place to prove its value. Those that prove the value will rise. ... So I don't look at it as a negotiation of plus CPM or minus CPM. I look at it more of a negotiation as to whether you want to be a partner with us going forward.
Ms. Herbst-Brady: The money's going to follow those people who are willing to partner to understand the future.
AA: What percentage of this year's upfront deals do you think will be engagement-based?
Ms. Herbst-Brady: I don't think you can put a number on it. ... Not everybody comes forward with the same level of commitment and desire to understand and partner, so that will probably play itself out over the next couple of months.
Mr. Donchin: I've gotten a lot of questions from a lot of cable networks, which kind of gives me some encouragement that they're going to be moving in that direction.
Larry Blasius, exec VP-negotiations, Magna Global: There's a certain amount of risk involved on the supplier side and to Court TV's credit they were willing to take the risk and they're going to force a lot of people to do the same thing. But to Elizabeth's point, I don't think we can insist on a percentage in terms of it's going to be, you know, 10% [of our upfront business] this year or 20%. Because a lot of people are unwilling to take the risk. ... Unless we sort of force the issue, we're not going to get the results.
Mr. Schwartz: I get to play in both the buying arena and the research area and I can tell you ... there will be multiple companies coming to the table. We're going to have on our desks many more proposals that we're going to have to weed through and say, "This one just doesn't hit it," and maybe continue the conversation or just say, "Maybe next year."
Mr. Donchin: The burden is actually a little bit on the buy side to look for partners that will do this with us, to try to see which partners we think are a little bit more important to us.
AA: Can you see the broadcast networks getting involved in these types of deals?
Mr. Donchin: We've got to move out of the dark ages. We're still fighting with them over this whole DVR issue. Let's take one step at a time. ... They seem to need to be pushed a little harder, but they were like that with everything, with added value, when we wanted to do things above and beyond the :30.
Mr. Schwartz: Some of the research people at the networks have opened up to discuss possible research that can be done to dimensionalize other variables. Not necessarily these variables, but other variables. Researchers are always out there trying to find out what they can do to better understand and better position their inventory. But we got to get the sales people to get to the next level.
AA: What do you wish for out of the next upfront? What questions would you like answered?
Ms. Herbst-Brady: I want to be able to ask a question, and either answer it or not. I mean, even if it doesn't bear out what I thought it was going to bear out, I've learned something and I can continue to move down the spectrum. ... How does pod length affect different viewership patterns depending on what type of programming it is? How are people experiencing a certain program? What's the effect of copy length?
Mr. Collier: With each one of these people, with respect to what's proprietary about their side of measuring the attentiveness, we've had questions about, how do we get the data to be more manipulable? How do we get questions to be more granular? ... We are all painfully aware that this is the start, not the end.