Challenge for Wal-Mart TV: Getting shoppers' attention

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Felicia Taylor shops at Wal-Mart for everything from groceries to dishes to shoes. But the Alameda, Calif., nurse said she never has paid attention to the Wal-Mart TV Network that broadcasts ads for new products and provides seasonal greetings, tips and suggestions from TVs scattered around the store.

"I just go in there and get what I want to get, and get out," she said. "I'm not there to watch TV."

Comments like that don't concern marketers who are big fans of advertising on Wal-Mart TV. "I don't think customers are always aware" of the messages they are receiving, said George Harrison, senior VP-marketing and corporate communications at Nintendo of America. Besides, Mr. Harrison, on Wal-Mart TV for five years, likes the fact that teens in the store can view mini-news segments about new products. His proof of effectiveness: Wal-Mart is Nintendo's No. 1 customer.

Still, there are questions about whether the estimated 100 million shoppers who walk through Wal-Mart every week actually watch in-store TV. That's the challenge for executives at Wal-Mart TV operator Premier Retail Networks, a private company backed by a number of media-related firms such as General Electric Co.'s GE Capital.

It's a `theater'

"It's one of the biggest media opportunities out there," said Mark Mitchell, PRN's exec VP-sales, who said the network reaches shoppers when they are shopping, and at a time they have no remote control. "We think of the store as a theater of communication."

The network, in fact, has been used as a focal point of Wal-Mart's version of retail entertainment over the years, hosting live concerts to introduce albums by singers such as Garth Brooks and an Oreo-stacking contest. More recently, Wal-Mart has integrated the network with in-store displays to back DVD releases. Packaged-goods marketers also have found it a mainstay of product introductions, using Wal-Mart TV to launch some 350 products.

Founded in San Francisco in 1993, PRN initially sold retail-store kiosks. Its big break came in 1997 when Wal-Mart signed up for programming to run on TVs for sale in the store, eliminating the annoyance of competitors' spots airing in-store during network programming.

Through its Wal-Mart TV Network, PRN runs a two-hour loop, updated weekly, with features such as a "What's new at Wal-Mart" segment often highlighting products on Wal-Mart shelves that have not yet been launched nationally via traditional media. In addition to product plugs, viewers are given aisle location.

no exclusives

PRN, which also operates networks with different programming in Best Buy, Kroger's Ralphs supermarket chain and Wal-Mart's Sam's Club, offers no category exclusives, said Mr. Mitchell. Because only 12 to 14 advertisers can be signed up per flight, and some time periods such as back-to-school and Christmas are in demand, Mr. Mitchell said he is considering conducting an upfront.

Four-week flights are priced from $50,000 to $300,000, depending on frequency, and the cost-per-thousand is similar to that of a prime-time cable buy, said Mr. Mitchell. According to a Nielsen Media Research study, each spot yields 154 million gross impressions over four weeks.

Mr. Mitchell and other PRN executives declined to discuss the company's financial arrangement with Wal-Mart, but noted the network works directly with marketers and ads on the network are independent of any deals Wal-Mart might cut with marketers. Nintendo's Mr. Harrison, however, said money for the Wal-Mart TV shows came from marketing dollars designated to back sales at the chain. "We discuss and decide where it goes," he said.

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