Marketers Warm up to the Benefits of Public Media

As Federal Funding Challenges Persist, NPR, PBS Work to Increase Corporate Sponsorship Opportunities

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This spring's attempt by Republicans in the House of Representatives to end federal funding for public broadcasting was the latest reminder that PBS and NPR's government support always has the potential to disappear. But government money isn't public media's biggest revenue stream. Despite some strict limits on sponsors' presence and messages, many marketers of different kinds have found the benefit of supporting NPR and PBS.

That's a good thing, considering the challenges to the government leg of the stool.

Joyce Slocum
Joyce Slocum

"Public broadcasting has always been asked to operate on a very modest budget," said Joyce Slocum, who became interim CEO of NPR in March after political controversies prompted former CEO Vivian Schiller to step down. "We have to constantly try to model the "what if.' We're in a good position right now, especially as more and more corporate sponsors realize that putting their foot behind public broadcasting breaks them free of where they might be elsewhere."

Corporate sponsorship accounted for 22 % of NPR's revenue in its fiscal year ending Sept. 30, down from 26% the year prior. It comprised 34% of PBS's revenue for the fiscal year ending June 30, 2010, compared to 46% in 2009 (although that includes some dollars committed for shows that didn't ultimately air until fiscal 2010).

Federal funding already has a smaller impact on public media's bottom line. It accounted for 2% of NPR's revenue in 2010 for the fiscal year ending Sept. 30, the same as it did the year prior. PBS received about 17% of its revenue from government sources in 2010, up from 11% in 2009. But some member stations, particularly smaller ones, rely on federal funding more than that . And costs are going to rise over time, but government money is far less likely to grow than corporate support.

"It is continually made clear to me that this is not an area of growth," said Paula Kerger, president-CEO at PBS.

Personal donations and member assessments continue to be PBS's biggest opportunity. Voter pressure on legislators also helps, but mostly in holding the line, not delivering gains. "We obviously went through a very complicated few months in terms of federal funding," Ms. Kerger said. "We were able to come through because so many people reached out to their legislator to say public broadcasting is important to them."

But public media has proved helpful to a growing list of advertisers across multiple categories. In the case of Fox Searchlight, the indie studio behind sleeper hits such as "Little Miss Sunshine," "Juno" and "Slumdog Millionaire," NPR has played a strategic role in its media strategy for well over a decade. In the case of "Tree of Life," the May release from Fox Searchlight, NPR received the entirety of the film's broadcast marketing budget.

"NPR's audience dovetails well with the campaigns for many of our films, which tend to appeal to educated, sophisticated audiences," said Dan Pittman, senior VP-media at Fox Searchlight. "I'm partial to "Morning Edition' and "All Things Considered' because they play in drive-time, so listenership levels are high. We often start a platform release with sponsorship messages on local affiliates, then expand into national sponsorships as our film's release pattern expands."

Credit: NPR

PBS tends to fare best with niche brands that don't otherwise spend a lot on broadcast TV, but shows such as "Nova," "NewsHour with Jim Lehrer" and "Antiques Roadshow" in particular can attract corporate-level attention from companies like General Motors and Chevron. "Being associated with PBS means being associated with someone committed to the arts, quality TV and preserving PBS's desire to infiltrate knowledge and education, not just pure entertainment," said Darcy Bowe, associate media director for Starcom USA, which has helped execute both corporate and brand-level buys for clients on PBS in the past.

Public-media sponsorship, however, still comes with a few drawbacks, according to marketers and agencies. Sponsors can't run traditional 30-second spots, for example, use calls to action in their messaging or advertise a specific promotion or product attribute.

The same uncluttered environment that helps sponsors stand out, moreover, also means inventory can sell out, particularly during heavy news periods. On NPR, inventory for corporate underwriters and show promos is limited to 100 seconds per programming hour (and a single-sponsor, 10-second limit for its podcasts), while PBS allows six minutes of programming time per hour for sponsors and show promos.

Should a series underperform in the ratings , the common remedy of "make-goods" -- in which networks make up for the shortfall by giving sponsors extra ad time -- doesn't necessarily apply.

And because corporate underwriting is often solicited directly by show producers, some PBS programs don't reach the schedule until after they've been financed by a sponsor, complicating or preventing traditional media planning. "It's hard to know where your spot's going to air or when," Starcom's Ms. Bowe said. "And since you can't often use timely messaging, you have to think about what your ad would look like if somebody saw it three years from now."

As a result, marketers don't plan for public media the way they plan to use, for example, Thursday-night comedies on commercial TV. "Generally those kinds of things tend to come off the top as opposed to allocation of a budget," said Rino Scanzoni, chief investment officer for Group M, WPP's global ad-buying unit.

All that said, there may be new opportunities for sponsors to gain exposure this fall. NPR is focusing on finding underwriting opportunities for its streaming radio and podcast programming. Digital now accounts for 20% of all NPR's sponsorship revenue and has increased 10% this fiscal year, according to Stephen Moss, CEO of National Public Media, the sponsorship arm of all NPR assets. Overall radio revenue is up more than 20% in the fiscal year, which ends in September.

And a document leaked this spring outlined PBS's plans to experiment with its first programming interruptions, a bid to redistribute the six-minute blocks of sponsor announcements, network branding and show promos that drive viewers away at the end of every hour. Sprinkling those same minutes across an hour would let PBS -- and viewers, PBS hopes -- jump right from the end of one show into the next.

"The goal in all of this is really more about, how do we increase the user experience?" Ms. Kerger said. "How do we bring more people into the tent?"

That may be the aim. But shifting sponsors' messages into the middle of shows, when viewers are most likely to be paying close attention, will also improve the corporate sponsors' experience -- perhaps bringing more of them into the tent as well.

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