But in 2004, when Scripps Networks began formulating the concept for what became its pioneering strategy for broadband channels, nary a network had launched one. Today, it seems every cable and broadcast network has a strategy for their digital offerings.
Scripps Networks has been prescient with its emerging-media strategies for the last several years, zeroing in on opportunities months before other media companies did, and similarly pulling back before a business segment cooled off. Its timing has made Scripps a poster child for how to bend, flex and adapt to the market and technology. The unit of E.W. Scripps Co. has extended its lifestyle expertise into several broadband opportunities, including the rollout of about a dozen broadband channels, and is exploring new video-on-demand offerings as well as cellphone video.
"We want to follow our customers across any platform," says John Lansing, president of Scripps Networks. "Our brand platform isn't about cable or TV. It's about providing a service to our customers in a category they have passion about and selling that back to advertisers."
Profits from the Web
Scripps' Web efforts are perhaps the best prism through which to view the company's strategy. The online business has been profitable for Scripps since 2003 and ranks third for the company in sales, behind the HGTV and Food Network cable networks but ahead of DIY Network and Fine Living. What's more, ad dollars for Scripps' interactive properties grew 600% in 2005, and similar growth is expected this year.
Overall, online video should generate $385 million in ads this year and $640 million in 2007, says David Hallerman, senior analyst with eMarketer. Broadband channels have another benefit: They're a net to capture an audience that may not watch the cable networks, and possibly drive it back to TV, he says.
Scripps launched its first network Web site back in May 1996 with HGTV.com. Because of the information-laden nature of the Scripps content and the corresponding use of the Internet, Ron Feinbaum, senior VP-general manager for Scripps Networks Interactive, believed an opportunity existed for a more holistic approach to broadband.
By the late 1990s, Scripps began investing in its online business with fresh content and trawling for online advertisers for its lifestyle networks -- Food Network, HGTV, DIY and Fine Living (launched in 2002).
Persevering through dot-com crash
Though the dot-com bubble burst in early 2001, Scripps began offering joint ad sales opportunities across its cable networks and Web sites, and built an e-newsletter business to market the sites. Today, Scripps sends more than 52 million e-newsletters each month.
When the main sites for the networks became profitable through advertising in 2003, Scripps began branching out with different broadband properties. In 2005 the company launched HGTVpro.com, which focuses on the professional-builder market, and Living.com, an online video magazine supported by GMC.
Next in line were the broadband channels that target specific slivers of lifestyle topics, such as remodeling and woodworking. First came HGTVkitchendesign.com, followed by HGTVbathdesign.com in April and DIYwoodworking.com last month.
Across its Web sites, Scripps has seen annual growth in video views of about 150%. In March 2004, for instance, Scripps attracted 4.7 million video views, a number topped a year later by nearly 7 million views. As those views grow, so does the corresponding online-video inventory. HGTVkitchendesign.com has been garnering 1 million video views a month, with a little more than one ad for every two videos viewed.
Scripps has poured other resources into broadband and introduced what's regarded as the first Web-exclusive show for a cable network. "Eat This With Dave Lieberman," which runs online under the Food Network banner but not on the cable network itself, premiered last November. During the six weeks that the network posted original episodes online, the show section on foodnetwork.com averaged 500,000 page views per week. Food Network plans to launch a second Web series, also starring Mr. Lieberman, on Aug. 14.
Elevating content and ads
To keep pace, Scripps is working on how to elevate the content and improve search results for its broadband sites, Mr. Feinbaum says.
Ads are evolving, too. Five years ago, Scripps served banners like everyone else. Now the intrusiveness of banner ads has been replaced by the immersiveness of integrated ad opportunities such as the kitchen and bath planners on the broadband channels, says Jeff Meyer, senior VP-interactive ad sales. The planners are sponsored by advertisers and allow site visitors to move a Kohler sink or a Viking range, for instance, into mock designs online.
There's also the marketplace section of HGTVpro.com, which brings viewers to product listings in ultraspecific areas, a niche opportunity for targeted, pre-screened advertisers.
Porting its video content online was a natural move for Scripps, given its expertise in niche topics such as kitchen remodeling, says T.S. Kelly, VP-director of research and insight at MPG, New York. "Now that user audience and appetite have both grown, Scripps can offer more original content online," he says.
Mr. Lansing says he's talking to cable operators about how to tweak the networks' VOD offerings, and he'd like to deliver episodes of current shows within a day or two after they air.
"We built a business here based on understanding how niche media can resonate with audiences and advertisers," he says.