Eyes on Local TV as Marketers Look for Way to Connect

Smaller Brands, National Advertisers Discovering Stations Are Also Media Companies

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NEW YORK (AdAge.com) -- To capture new business for its TV stations, NBC Universal has begun selling something other than just TV ads and, in the process, is opening itself up to new money.

NBC local stations are trumpeting a multivitamin product from Nature's Way on their Twitter feeds and Facebook pages as well as in promotional email blasts; working Cosi restaurants into "Talk Stoop," a celebrity meet-and-greet program on a digital-cable channel; and creating ads featuring "Today" weatherman Al Roker to hype Expo markers. The marketers involved had never run TV campaigns before.

Local advertising is getting more attention, particularly as smaller marketers -- and national advertisers seeking to spend more heavily in specific regions and in smaller communities -- have grown more sophisticated. They are more eager to test out video advertising rather than relying entirely on direct mail, Yellow Pages and local newspapers.

And owners of local-TV outlets have discovered that in this digital age, "they are local media companies, as opposed to TV stations," said Mark Fratrik, a vice president at consultant BIA/Kelsey. TV remains a large part of the sales proposition, but if station executives believe TV is the sole driver of ad revenue, that could leave rivals eager to sell other kinds of media a hook with which to approach local clients.

Among local broadcasters' newer competition for dollars: AOL's Patch, a series of local-news websites; local newspapers that have been investing in "hyperlocal" sites; and Google search. TV stations, however, have a long standing in their local communities, said Mr. Fratrik, and the ability to gather large groups of consumers together to the living-room screen, then push them to digital venues.

"At one time, we probably did less than 10% of our revenue ... from these kinds of efforts. Now we think this is the growth side of our business," said Frank Comerford, president-platform development and commercial operations at NBC Local Media.

At CBS Corp. an effort is afoot to create new media outlets for local advertisers. The company, which operates TV and radio stations in major cities, is combining its assets in city-focused online portals. A Los Angeles site, CBSLosAngeles.com, offers traffic, weather and content from CBS's L.A. TV and radio outlets. Among marketers using CBS's new local venues are MasterCard and Allstate.

Historically, radio and TV sales staffs worked separately, said Anton Guitano, chief operating officer of CBS Local Media. Now, he said, the company is "looking toward more cross-promotion."

Why the push now? Local TV stations have suffered through a particularly wrenching economic period. Meanwhile, ad clients are demonstrating more interest in nontraditional media.

According to BIA/Kelsey, local spending on traditional media will fall to $108.2 billion in 2014 from $115 billion in 2009. During the same period, spending on all online and interactive media is projected to grow to $36.7 billion in 2014 from $15.2 billion in 2009. The consultant estimates 55% of all U.S spending in 2009 was on local media.

Larger media companies can offer some advantages smaller ones may not. It's one thing to be a local station owned by a larger, national media concern and quite another to be a local affiliate with business that is often much narrower in scope.

At Cosi, executives had primarily advertised to people who came into their outlets, said CEO Jim Hyatt. Yet the company had established a presence for itself in large cities and wanted to draw new fans.

Talks with NBC led to a broad marketing program involving multiple kinds of media, including ads on "Talk Stoop," a celebrity-interview show that airs on a digital-cable outlet operated by NBCU's WNBC New York Station, as well as outdoor advertising tying Cosi to the show.

"We needed to connect with a method that behaved the way our customer was behaving -- the transit, the in and out, the walking the street. ... We're not counting on one device to drive the numbers." And neither is TV.

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