CNN Tests New Ways To Mix Ads With News

Do ads belong in the ubiquitous news ticker that scrolls along during so many TV-news broadcasts? CNN is willing to find out.

The Time Warner-owned cable-news outlet is open to the idea of running an advertiser’s logo in its bottom-of-the-screen zipper, so long as the appearance is tailored appropriately, said Katrina Cukaj, executive vice president of CNN ad sales. “If it’s financial information, if it’s actual data from the markets, I could potentially put a financial advertiser on there,” she said in a recent interview.

In years past, CNN shunned such stuff, in the belief that mixing editorial and advertising too closely could foster a perception that CNN’s journalism was swayed by a sponsor.  Throughout 2014, however, CNN seems to have, well, gotten over itself: The network has looked for more ways to weave ad messages into programming not so tied to breaking news, such as its “New Day” morning show – where a logo for General Mills’ Fiber One cereal shows up during weather reports – or its original documentary series slated for primetime.

“You could use the same model as sports, in which the scoreboard is not just a scoreboard, and when you look at it on television, it is sponsored by different brands at one time or another,” said Larry Chiagouris, a professor of marketing at Pace University’s Lubin School of Business in New York “You could look at this and say that’s what news television is going to become. I don’t think we are looking at five years from now. I think that this is all happening very quickly.”

CNN isn’t the first to tread these waters, of course. Yet its embrace of these concepts may be the biggest indication yet that concerns about mixing advertising and journalism seem less pressing when the ad dollars that fuel reportage are migrating away from some TV outlets. MSNBC has long allowed Starbucks to sponsor its “Morning Joe” program, even when Howard Schultz, CEO of the coffeehouse company, was being questioned in 2011 by co-host Mika Brzezinski. Many local-news broadcasts feature weather or sports segments sponsored by a single advertiser, and one Las Vegas outlet in 2008 famously placed cups of iced coffee emblazoned with a McDonald’s logo on its anchor desk. CNN is simply dipping its toe in a pond that has already been warmed.

The network’s newly aggressive ad stance is a bet on the future of how TV-news will be experienced.  To be sure, CNN is still a TV network. But a rising generation is more likely to sample its programming with mobile tablets and smartphones.  In 2013, according to a survey by Pew Research Center’s annual “State of the Media” report, 82% of Americans said they got news on a desktop or laptop and 54% said they got news on a mobile device.

The cable-news outlet may have more leeway on the screens of these devices to display ads that are not seen as encroaching upon the content. On CNN Go, the network’s mobile app, users can pick what reports they want to see, and an advertiser can put forth the notion that it helps bring the news to the consumer.

One of the reasons Lexus signed on as a charter sponsor of CNN Go was the chance “to help deliver more engaging content to tech-savvy consumers,” said Brian Bolain, corporate manager of Lexus marketing, via email. “We see the news industry becoming more personalized for each individual viewer.  The content, as well as the advertising, will be hyper-interactive as viewers will be able to engage with and experience the news rather than just watch it.”

Fostering that distinction – helping to bring news from an outlet to a consumer, as opposed to interrupting or influencing it – may give CNN an ability to woo Madison Avenue in different ways. In recent months, the network has signed Volkswagen as a “presenting sponsor” of its original films; enlisted the CEO of Allstate to praise documentary series “Chicagoland” in advertisements that accompanied that show; signed Acura to sponsor “sneak peeks” at the end of  its “Parts Unknown” series starring Anthony Bourdain;  secured Holiday Inn as a producer of a series on HLN; and given telecommunications advertiser T-Mobile prominent placement in a show on that network, “The Daily Share.”

CNN tests these ideas as it has had to fight harder for ad dollars. In 2013, the network took in $319.8 million in ad revenue, according to data from market-researcher SNL Kagan. In 2014, that total fell about 10.7% to about $285.4 million. SNL Kagan projects CNN ad sales will decline about 4.1% to approximately 273.5 million in 2015. As TV’s annual “upfront” market – the time when U.S. TV networks try to sell the bulk of their ad inventory – nears, the network could offer similar to those above to lure more ad dollars from potential sponsors seeking closer ties to the programs they support.

The network follows its course with the knowledge that advertisers still want to chase news junkies, even if they get their “fix” in a new way.“We have to do more research on when do people actively consume more news,” said  Manuel Sattig,  head of brand communication for BMW North America, which recently  agreed to sponsor a new CNN initiative on Snapchat. “We have to find more ways that are more targeted” when placing ads in front of  news aficionados.

Placing these ads in some of CNN’s more traditional programming might be difficult, acknowledged Donna Speciale, president of ad sales for Turner Broadcasting, of which CNN is a part. “In breaking news, you don’t know what’s going to be happening and a lot of it is tragedy. Clients don’t want to get near that, and that environment is not ideal” for some messages. But the increase of programming that has elements of entertainment in it lends the network the opportunity to test ideas “CNN hasn’t had in the past,” she said.

CNN’s challenges in recent years are well known among advertisers. As the network strived to stick to a centrist presentation across its shows, even those in primetime, rivals like 21st Century Fox’s Fox News Channel and NBCUniversal’s MSNBC stole viewers. Fox News remains cable’s dominant news network, but CNN has in recent months made strides against MSNBC, which has made major shifts to its daytime lineup.  Both Speciale and Cukaj said they were mindful of maintaining boundaries between ads and editorial content. Many of the advertising concepts, they added, are made in consultation with show producers and CNN Worldwide President Jeff Zucker.

“We have a live network that has a decent amount of real estate on there,” said Cukaj. As coverage of the 2016 elections gets underway, she said, CNN sees a potential chance to bring advertisers into sponsorship of quizzes and polls.

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