J. Walter Thompson USA will soon begin using a radical plan to buy cable TV time nationally while placing advertising locally.
The plan, which has taken more than a year to work out, will involve buys on ESPN later this year, said Jean Pool, exec VP-North America media buying services at JWT.
Once a buy is negotiated, instead of running the spots on ESPN's national feed, cable operators will insert various commercials for JWT clients into the feed at the local level.
After submitting an affidavit of performance, the local operator will be paid by ESPN for inserting the commercial.
TCI TO TEST PLAN
Tele-Communications Inc., the nation's largest multiple system operator, has agreed to test the plan.
"This is ideal for clients with dealers or franchises in local markets," Ms. Pool said.
While she declined to name any advertisers that might participate, JWT clients such as Ford Motor Co. or Domino's Pizza, which uses the agency only for buying, could take advantage of the plan.
BOON TO CAR DEALERS
As an example, viewers of ESPN in Kalamazoo, Mich., might see a Taurus commercial tagged with the local Ford dealership, while viewers in Atlanta would see one for an Explorer tagged with a dealer there. Or JWT client Twentieth Century Fox might want to use the plan to concentrate advertising for a particular movie in certain areas.
Now that JWT has joined with sister WPP Group agency Ogilvy & Mather Worldwide in a new media-buying alliance, the plan may eventually O&M clients as well.
"It's sounds very, very clever," said one cable buyer at another agency. "I wish I could trash it, but it really sounds like a good plan."
"We hope that this is incremental revenue, and it sounds like a win-win situation," said Jim Birschbach, VP-advertising sales.
Ms. Pool has been a critic of buying local cable TV time for national advertisers, decrying its high costs per thousand viewers as well as billing and posting problems.
The current system "is just not been an efficient buy for the national advertiser," she said.
Only about 10% of local cable ad revenues come from national advertisers.
"The dilemma has always been that cable has some wonderful programming with a terrible price problem. The idea here is to fix that, make cable an efficient buy for our clients, yet take advantage of what cable has to offer," she said.
With the JWT plan, a cable network would get national money it wouldn't ordinarily get, and the local operator gets money he wouldn't get.
"Since cable has so much inventory to sell both locally and nationally, this seems like it would work," said a top ad sales executive at another cable network.
"My one big concern would be to make sure that this money is not money I would ordinarily have seen locally," said a sales manager at a major MSO.
Ms. Pool emphasized that the money earmarked to be spent under the plan indeed would be national dollars.
Copyright April 1997, Crain Communications Inc.