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CROSSING OVER TIME ZONES AN IDEA TO BOOST SPOT BROADCAST DOLLARS CREATES SKEPTICS

By Published on .

On paper, it sounds like a great idea. Local broadcast stations should "zone" their ad inventory, according to cable operator boundaries, giving advertisers the option of buying the portions of the market they want.

This technology already exists, but there's one problem: the ad community is only mildly interested.

Advertisers looking to reach pockets of a market have helped boost spot and local cable ad revenues. According to the Cabletelevision Advertising Bureau, spot and local cable revenues totaled $1.1 billion last year-26% above the $872 million in 1992.

Spot broadcast TV ad revenues, while still much larger than spot cable, are growing more slowly. According to Competitive Media Reporting, spot TV ad revenues grew 4% last year to $9.8 billion.

A consultant's presentation at this year's Television Bureau of Advertising convention promoted broadcast zoning as a way to boost the medium's revenues.

Stations "could get more revenue per spot by breaking it in smaller parts than by selling it as one piece," says Michael Gorman, a partner with Teller/Gorman Group, the consultancy that prepared the presentation.

For example, a station that charges $10,000 for a local 30-second spot can partition the spot into four zones, based on cable operator boundaries, and sell each part at $4,000. Total revenue then would be $16,000.

Although Mr. Gorman says stations can implement this feature "without having to wait for a technology revolution," a revolution in thinking from media buyers and stations might be what's needed to make broadcast zoning commonplace.

"While there may be regional skews, often the smallest unit of [broadcast audience] measurement is the [designated market area]," says Susan Ward, VP-director of broadcast negotiation, Campbell Mithun Esty, Minneapolis.

The marketers that might use broadcast zoning, Ms. Ward envisions, would be businesses whose trading areas are smaller than DMAs-and who might already be using local-cable buys.

Stations wanting to implement zoning would first have to address several major issues-most notably, how ad time for non-cable households would be handled.

In fact, Ms. Ward says excluding non-cable households from zoned buys, which could eliminate up to 30% of households in an area, makes the concept "a much more difficult proposition."

Some broadcasters say it's not over-the-air TV's function to get involved in zoning.

"I think you buy [broadcast] TV to reach broad audiences and make big amounts of people do things," says Barry Baker, CEO of River City Broadcasting, adding that no agency or advertiser contacts have asked him about zoning.

However, Mr. Gorman says it's possible for mass marketers to use broadcast zoning. As an example, he says, an auto marketer can buy all zones for one 30-second spot and place a tag listing the nearest dealer at the end of each zone's spot.

"It's still mass, but it's customization that's worth something to a carmaker and to the local dealer," he says.

Mr. Baker acknowledges the interest in reaching target audiences. But, he says, "you can do targeted marketing alongside mass marketing-but it's not a substitute for mass marketing."

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