Ad spending habits 'disrupted' as sponsors rethink strategy
In a turbulent TV biz, there is one constant: The Super Bowl. But even that mega-pageant is not immune to the changes sweeping the ad world from Hollywood to Madison Avenue.
At the upfronts last May, ABC sold most of its inventory (about 55 spots) to the Feb. 5 telecast, which is aptly branded Super Bowl XL. ABC is charging a premium of $2.6 million for 30 seconds. The ads have grown so prominent that they get dissected each year by the national media, like a miniature Sundance Film Festival within the game.
The Super Bowl, which commands an audience as high as 100 million Americans every year, is the biggest event in advertising — and because everyone watches it in real time, one of the few broadcast events that’s TiVo-proof.
But as broadcasters struggle to connect with a fractured marketplace, marketers are rethinking their approach to the entire TV spectrum. That includes such blockbuster broadcasts as the Super Bowl and the Olympics, even the Oscars.
All three events will be held in the next three months, and advertisers are being offered a wider variety of multimedia packages and ad formats.
On Super Bowl Sunday, ads will come in 15-, 30-, 60- and 90-second varieties. A number of advertisers are buying around the game — in the pre-game or post-game show, on ESPN radio, in ESPN magazines and on an Internet service called ESPN Motion, which streams game highlights to your PC. Many are investing in retail promotions, sweepstakes and elaborate product placement deals on other ABC shows.
Elsewhere on the dial, networks are experimenting with more ad breaks (or “pods”) per hour and 5-second “pod-puncher” ads designed to be the last to run before a show resumes.
“Now nobody buys only an ad in a game or an ad in a magazine,” says Ed Erhardt, who as sales prexy at ESPN and ABC Sports is overseeing the Super Bowl ad sales this year. “They have a multimedia plan.”
Advertisers, Erhardt says, “recognize that sports fans — and men in particular — get their news and information in lots of different environments. You have to be creative in your media messaging if you’re a marketer trying to reach men.”
Overall network ad sales are flat, as major advertisers continue to shift their marketing spending away from TV. Nontraditional advertising, from direct marketing to Internet search ads — all text and no pictures — is booming, a factor that helped Google’s share price balloon to $400 last month, while traditional media companies remain stuck in neutral.
Procter & Gamble, which spent $2.5 billion on TV advertising in 2004, announced last spring that it planned to reduce its upfront TV buys by 20%. Verizon’s broadcast TV spending now accounts for 20% of its overall media mix. Four years ago, it was 33%.
Visa, for one, is plunging into new areas with its ad buys. It’s a major sponsor of both the NFL and the Olympics, which will take place in February. For the first time this year, Visa will underwrite an Olympics blog on NBC’s Web site.
But two months before the Super Bowl the credit card company, which has aired a Super Bowl spot every year for the last 10 years, still hasn’t yet decided whether it will run an ad during the 2006 telecast.
Others have already decided they will skip the game altogether.
Sara Lee — a company that spends $1 billion annually flogging such products as frozen cheesecakes and Wonderbras — altered its course after execs took part in an exercise at the Marina Del Rey, Calif., headquarters of Chiat/Day to test the effectiveness of the Super Bowl telecast for its hot dog brand, Ball Park.
The ad agency execs call the exercise “disruption day.” Part motivational workshop, part corporate hazing ritual, “disruption” is designed, in part, to help clients navigate a fast-shifting media world. More often than not, it involves steering them away from the conventional marketing mentality, in which a 30-second spot on network TV is deemed the most efficient way to get a product to stick to the wall.
While “disruption” is a credo for Chiat/Day, it’s also an apt metaphor for the entire blurb business.
On this particular day, Sara Lee execs partook in a simulated Super Bowl Sunday, sandwiched around 10 hours of brainstorming sessions.
One Chiat/Day office was decorated like a living room, with couches, bowls of chips and bigscreen TV playing game footage from previous Super Bowls. Outside the boardroom was a Nissan pickup truck packed with cases of beer, pretzels and spicy chicken wings. “We Are the Champions” and “Gridiron Groove” blasted from the office PA system.
Sara Lee execs came prepared to spend big on a conventional Super Bowl ad. They left with a different plan: a viral Internet campaign that turned on tailgating parties, stunts and contests.
As the Super Bowl has ballooned into the year’s most orgasmic media event, other advertisers are expressing queasiness about buying time on the telecast.
“Clients are feeling they’re under a microscope,” says Carisa Bianchi, prexy of Chiat/Day Los Angeles. “It’s kind of like ‘American Idol.’ ”
Last month, Visa moved its account — estimated to be worth about $350 million annually — from BBDO to Chiat/Day, wooed in part by the disruption process.
On the day the Visa deal was announced, widespread celebrating broke out at Chiat/Day’s canary-yellow office complex, which resembles a funhouse version of a studio lot. By late afternoon, employees were serving beer from behind a cappuccino bar at one end of “Main Street,” a long corridor that links the lobby to an indoor basketball court.
Employees drifted with their dogs through “Central Park,” a sandy area landscaped with real trees and park benches. A guy in a T-shirt whizzed by on a scooter. The funk hit “Good Times” was playing from speakers behind the bar.
The idea of disruption was concocted by Jean-Marie Dru, the French-born CEO of parent company TBWA. Today it’s a management philosophy applied like Jack Welch’s Six Sigma to every arm of TBWA, from L.A. to Oslo, as well as a tool kit to tackle new accounts — and perhaps most important, a mechanism to market the agency to its clients,
Chiat/Day has held some 500 disruption days in the last 10 years. What comes out of these sessions are new product ideas and distribution plans, as well as new ideas for viral ad campaigns, guerilla PR, experiential marketing at stores and cultural events — all the sort of marketing efforts the Hollywood studios are exploring as they try to reach an audience that once was held captive by broadcast TV.
“We’ve built a model where we want to come up with a big idea for a brand,” Bianchi says. “Is it future-proof, does it have many years of success built into it, and secondly, can it actually translate across any channels that we think would be appropriate for the brand?”
The point of the Super Bowl disruption, she says, was to ask, “How do I ambush the game if I can’t afford to be in it, how can I capitalize on the event in guerilla tactics? If I am going to be there, how can I get noticed?”
To be sure, conventional TV advertising is far from dead. This year’s upfront sales for the big six broadcasters were up slightly to an estimated $9.3 billion.
Super Bowl XL will feature regular advertisers such as Anheuser-Busch, Coke and Pepsi, and most of the Hollywood studios are expected to have a major presence.
“Large advertisers cannot afford not to be on TV yet,” Visa USA chief marketing officer Susanne Lyons says. “You can’t walk away from it yet. But you’re seeing a lot of experimentation around the edges.”