Disney, Toys 'R' Us sign cross-media deal

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Walt Disney Co.'s ABC Unlimited is taking multimedia ad deals to a new level, signing the country's largest toy retailer to a truly broad-based integrated media campaign across all Disney properties.

The one-year deal with Toys `R' Us is valued at $25 million to $30 million in paid media, but the pact will far eclipse other major cross-media deals in scope if not price. Procter & Gamble Co.'s $300 million agreement with Viacom Plus (AA, May 7) and Tricon Global Restaurants' $100 million pairing with NewsCorp One (AA, June 4) were virtually TV-only deals. ABC Unlimited's agreement, however, encompasses magazines, newspapers, a theatrical movie, radio and even non-ABC owned properties.

While not confirming the dollar amount, ABC executives characterized the deal, which was six months in the making, as ABC Unlimited's biggest to date.

"This is not a cross-media deal, this is not a bundled deal," said John Muszynski, executive VP-chief broadcast investment officer for Bcom3 Group's Starcom USA, Chicago, Toys `R' Us' media agency. "This is truly an integrated deal, which is not the type of deal we have seen in recent weeks."

For Toy `R' Us, the focus of the pact is to relaunch its 20 stores in top markets, which includes a high-profile new store in New York's Times Square. A primary goal of the relaunch is to make its stores more accessible to kids-instead of towering shelves of toys, Toy `R' Us will be lowering its displays for easy access. The retailer's renewed emphasis on children, rather than their gatekeeper parents, made kid-friendly Disney a logical choice as media partner.


For its part, the retailer will get ads on ABC prime-time shows, daytime and news programming blocks, ABC's Disney Kids Network (including "Disney's One Saturday Morning" block), the Toon Disney cable network, Disney.com and Radio Disney. Other exposure will be on Lifetime and E! Entertainment, two cable networks in which Disney has separate equity stakes.

The pact also includes Disney publications Disney Adventures, Family Fun and Disney Magazine, and the deal will help promote a Sunday newspaper supplement to run in November that pushes the Toys `R' Us "Big Book" catalog. The supplement is to run in newspapers reaching 50 million homes.

The entire deal funnels into a promotion for the Nov. 2 release of Disney's Buena Vista Pictures' "Monsters Inc.," with Toys `R' Us as a major tie-in partner. The toy retailer will launch a special "Monsters" commercial when ABC airs "Toy Story" (a Disney/Pixar Animation movie) on the network in October.

Six ABC-owned stations will also get local TV spot money, and in an unusual move, ABC arranged for another media buy, through an additional 14 non-ABC owned stations that are ABC affiliates. The extra stations were selected to cover markets where there are Toy `R' Us stores, and ABC said all 20 stations will contribute promotionally to the campaign.

"This deal was something that we hadn't seen from any other media outlet," said David Walker, VP-U.S. advertising and marketing for Toy `R' Us. "Bill [Bund, senior VP-integrated sales for ABC Television Network, who runs ABC Unlimited] was really one of the first people who came to us with an integrated strategy. The operative word is `integrated.' I get to replicate this across 20 markets. We would want to do this again."

"Price was not really a factor," said Mr. Muszynski of the Toys `R' Us deal. "I'm not saying it wasn't a consideration. But without the ideas, you don't have a deal."


Money does come into play. According to one executive close to the companies, ABC and other Disney outlets gained in this pact by increasing their collective overall take with Toy `R' Us, almost doubling the advertiser's total advertising revenue with ABC.

Many executives speculate that cross-media deals, such as those of P&G/Viacom and Tricon/News Corp., yield an increase in overall advertising dollars to the media seller. But, in return, the sellers give lower cost-per-thousands prices [CPMs] vs. a year ago. For instance, in exchange for lower CPMs in the P&G/Viacom deal, "[P&G] increased cable dollars tremendously," said one executive.

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