REICH COMMUNICATIONS

Upfront Week

 

It’s probably TV’s biggest week, and it’s not even on the air.

Upfront Week, happening now here in New York, brings execs from ad agencies, media buying firms and advertisers together to hear from the networks (over-the-air and cable) about their planned fall schedules and their new and returning shows.  The Upfront presentations are giant dog & pony shows in high-profile spots like Radio City, Lincoln Center and Carnegie Hall, and the nets trot out their stars, putting their late-night hosts Jimmy Kimmel, Steven Colbert and Jimmy Fallon to work as emcees.

There’s big money at stake – upwards of $16 billion in advance commitments by advertisers to buy time in the nets’ primetime schedules next season.  Advertisers scramble over each other to buy positions in what they are betting will be the big hits next fall.   They’re afraid if they wait, they could get locked out of a hit show, or if they can buy spots in the fall, the prices will be quite a bit higher.  That’s been the traditional thinking that’s enabled the networks to keep raising prices for ad time, even as their audience continues to shrink.

Years ago when the late media buying guru Gene Dewitt was a client, I’d line up interviews for him with ad biz reporters at The N.Y. Times, USA Today, The L.A. Times, CNN and the ad trades, where he’d make his prognostications on which new shows would be hits and which would fail.  He also would decry the whole upfront process, claiming it pits advertisers against each other in a feeding frenzy that really only serves the networks -- pushing their ad prices higher.  For years, Gene used to predict the end of the upfront marketplace, encouraging advertisers to forego the hyped feeding frenzy and push back, demanding better programming, more audience data and an orderly structure for pricing and buying ad time.

And here we are, a dozen or more years later as the Upfront is again underway.

Stories in The Times (New York and Los Angeles) are reporting that this year’s Upfront could see only a small increase in sales – maybe 3% -- or even a decline of 2 or 3%.   

There are a number of factors converging to bring a change, not only in Upfront spending, but in ad spending on TV overall throughout the year.  One analyst quoted in the L.A. Times says it will go down by 2% this year.

What’s happening?

*  TV viewership is down.  Except for major sports and news events, TV doesn’t draw in the huge number of viewers that it used to.  The nation no longer tunes in, almost as a whole, to see Ed Sullivan on a Sunday night.  Primetime viewership over the past three years is down from 10% (FOX) to as much as 24% (ABC.)  Only NBC has seen an increase of 7%, thanks only to a bump last year fueled by its mega-hit “This is Us.”

*  We can watch what we want when we want.  And we can go to so many more places for news – 24/7 and even reflecting our own political biases, if we choose.  The amount of programming is mind-boggling.  Where we used to have perhaps 100 choices of scripted programs between the 3 or 4 major networks, we can now choose from more than 600 scripted programs on the networks, on cable and now on streaming platforms like Netflix, Hulu and Amazon, ready to play whenever we choose.

*  Add to the networks’ woes the fact that coveted younger viewers (the 18-49 demo) are watching less and less of anything on regular TV.  Many don’t even own a TV or they are not hooked to an antenna or cable.  They stream bits and pieces on their laptops, tables or phones... or their unconnected big-screen TVs.

So as the TV audience disappears and fragments, the networks hope to raise their ad prices yet again.  This year, the average $134,000 cost for 30 seconds on primetime was 6% higher than it was the previous season.  Even if it does go up again for next season, how many more years will advertisers keep paying higher prices for fewer eyeballs?

It’s not totally bleak for the networks.  The shows they produce bring in money for them when they are shown on other platforms.  And some shows that eventually go into syndication can be a golden goose for the producing network and/or the producing studio, often owned by the network or the network’s parent company.

And meanwhile, we’re in the midst of another Upfront Week.  With lavish over-the-top presentations and parties, it’s good for New York’s economy, if nothing else.

Using PR to Extend the Reach of Ads

 

It costs a lot to advertise.  Thirty seconds on a hit network show can be upwards of $100,000.  A spot on the Academy Awards broadcast is going for more than $2.5 million.  Spots on the Super Bowl cost upwards of $5 million.

And remember, those numbers are just for one spot -- 30 seconds that interrupt a program, when many viewers run to the kitchen or the bathroom.  And a key element of advertising is frequency -- ads have to be seen many times in order to have a real impact.

So some advertisers use PR -- publicity -- to extend the reach of their ads at relatively little cost.  Think of the super bowl of advertising venues -- the Super Bowl.  Many advertisers use PR to hype their ads before the big game, pushing for stories in the media and getting them seen and talked about via social media. 

Advertisers sometimes do something intentionally controversial in hopes of getting a bigger bang thanks to PR.  We saw an example just last week, in some outdoor ads in Boulder, Colorado for a local chain of sushi restaurants called Hapa Sushi.  According to ADWEEK, the chain ran a series of ads on kiosks and bus shelters downtown that used tweets by the president, unedited.  One ad shows a presidential tweet threatening the head of North Korea, followed by the words "Eat well before it all ends."  Another used a tweet that reads "The global warming we should be worried about is the global arming caused by NUCLEAR WEAPONS in the hands of crazy leaders!" 

Some Boulder officials missed the humor and asked the advertiser to edit the ads. Instead, the sushi chain agreed to take the ads down after only a few days.  But they garnered attention in the local newspaper, the Boulder Camera, local TV and other media around the state. 

Minimal ad expense -- bigger bang through publicity.

Years ago, one of my clients -- an ad agency -- was planning to run a huge billboard ad in the Times Square area, directly opposite a church.  The ad, for a maker of high-end toilets, showed people from behind standing at toilets, with their butts fully or partially exposed.

After the church voiced a complaint to the billboard company, the story got out to the media.  It ended up running in newspapers and on TV in New York and nationwide, with most of the stories showing the proposed ad, along with the name of the advertiser. 

A few weeks later, after the news died down, my client admitted that they had never actually planned to run the ad.  They had tipped off some folks at the church, which prompted the complaint to the billboard company.  And they gave the story to a friend in the media.  Once one outlet wrote about it, it exploded everywhere else.  

Afterwards, they asked me to do an ad equivalency evaluation for them, and the "free" exposure ,they got was worth several million of dollars.   And they never paid a dime for an actual ad, other than the very minor expense of having a mock ad created.

Clever?  Devious?  You decide.  It worked.  It caused some laughs, and no one got hurt. 

 

 

What We Do ... Drive Safe Los Angeles

I'm on the road for client The National Road Safety Foundation, for our third year of a partnership with the Los Angeles Auto Show, which opens Dec. 1

We run a contest designed to engage young people on southern California in messaging about the dangers of distracted driving, which is responsible for more than 3,000 traffic fatalities every year.  Teens are invited to submit their ideas for a 30-second public service message about distracted driving.  The winner gets a $2,000 prize and works with Emmy Award-winning producer Alan Weiss to make the winner's concept into a finished TV spot that debuts at the auto show in L.A. and then airs on more than 150 TV stations nationally.

This year's winner is 18-year-old Franklin Reitzas, from Bell Canyon just over the L.A. line in Ventura County.  Franklin has a better picture than most of us about what distracted driving can do.  While in high school, he was in the Explorers program run by the county sheriff's department and he got to go on ride-alongs with police officers.  He says he's seen too many crashes that were caused by distraction or driver inattention, which is why he decided to enter the contest.

Here's a sneak preview of Franklin's PSA...

 

I'll be off to Washington D.C. in January, Chicago in February and Atlanta in March for similar regional contests in conjunction with the big auto shows in those cities.  We look forward to seeing many more great public service message ideas from young people in those areas.

 

 

What We Do ... Traffic Safety

 

Here's a sampling of what we do for The National Road Safety Foundation. 

Among many other things, we've developed a series of teen contests that tie in with major auto shows around the nation, as a way to engage young people in creating and spreading messages about distracted driving.  We invite teens to submit their ideas for a public service message on distracted driving and the winner gets a $2,000 prize plus we send the producer of syndicated show Teen Kids News to the winner's school to work with the student and others to make the idea into a 30-second TV spot that will air on Teen Kids News, which is carried on more than 150 stations nationwide.

We're in the midst of picking the winner for our Drive Safe Los Angeles contest, which will be shown at the L.A. Auto Show beginning Dec. 1.  We do similar projects with the Chicago Auto Show in February, the Atlanta Auto Show in March and we just began our first Drive Safe D.C. contest, with the Washington D.C. Auto Show in January. 

 

We get some great ideas for public service messages from young people.  Check them out here.  To see the full Road Buzz newsletter, click here.

And drive safely.

 

Changes

 

It's hardly news that technology...especially the internet...is changing how we live and work.  This is underscored by a few items in the news today.

eMarketer reports  on a survey showing changes in how we interact via email.  More than half...55%... of emails are opened on a mobile device, nearly double the amount on webmail servers like Outlook and far outstripping the 16% now opened on desktops.

When the survey was last done in 2012, only 29% of emails were opened on mobile devices.

eMarketer estimates there are currently about 248 million email users in the U.S. That's about 76% of the total U.S. population.

Marketers continue to use email heavily to reach out to customers and prospects.  About 88% of marketers in key industries rely on email, with the highest percentage of email users in the healthcare/pharma fields and travel/hospitality.  Retailers are slightly below average in terms of email outreach.

But outreach or not, more of us are shopping online.  Deloitte, in its annual forecast of holiday spending, predicts that 51% of holiday purchases will be made online this season, marking the first time online spending will be greater than in-store buying.

That might explain the third item of interest.  Lord & Taylor announced it is selling its 11-floor flagship store on Fifth Avenue to WeWork, which will convert most of the space into shared workspace.  The pricetag is $850 million.  (How many Gucci bags would they need to sell to make $850 million?)

The change won’t happen until after the 2018 holidays.  The retailer plans to keep some space in the building, so it will still have a presence on Fifth Avenue.  Hopefully, they’ll still have their holiday windows every year, which continue to draw crowds at Christmastime.

Times Square is Prime Ad Space

 

For many of us New Yorkers, Times Square is a place to avoid unless you have business there or theater tickets.  It''s crowded with gawking tourists who stop to take in the sights, blocking the sidewalks.  It's not a place to travel through if you're in a hurry.

That said, Times Square exciting, especially at night when it's lit up bright as day by all the giant signs and video screens.  It's a grand plaza, comparable to the piazza in Venice except with fewer pigeons.

Times Square is also one of the most valuable advertising spaces in the world.

The Times Square Advertising Coalition reports in a recent survey that an average of 300,000 people walk through Times Square every day, with the number inflating to 480,000 or more on busy days.  Only about half are tourists.  Of all those visitors -- locals and out-of-towners alike -- more than 80 percent will post a photo om social media, often with signs in the background. 

The average visit to Times Square is 81 minutes, of which about eight minutes are spent just looking at all the advertising signs.  The ad coalition estimates that a billboard advertiser can expect about 1.5 million impressions every day.

That explains why marketers can spend upwards of $4 million to rent space on a Times Square billboard. 

So next time you find yourself in Times Square, as you look around at all the signs, remember you are in the midst of a giant ad.

 

 

Marketers' PR Dilemma ...Take a Knee?

 

 

The recent take-a-knee actions by many NFL players has taken center stage, thanks to divisive tweets and statements by the president.

While it's made for interesting TV and a diversion (perhaps intentionally by the White House) from Russian collusion, healthcare, tax reform and other important national discussions, it has also created a public relations problem for marketers whose audience and campaigns are connected with pro sports and its players. 

At issue here is the individual's right to free speech, which has been wrongly conflated by the tweeter-in-chief to incorporate respect for our flag and our military. 

Initially, before the president got involved, perhaps five or six players had spoken out and taken a knee as a way to protest what they felt has been unfair treatment of minorities by some police and some courts.  But once the president jumped into it in his usual brash and uninformed way, upwards of 200 players – in many cases, entire teams and their owners – showed support by taking a knee and/or locking arms during the national anthem, directly in protest of the provocative statements by the president.  At the same time, the athletes have made it clear that their actions in no way are intended to reflect disrespect for our flag or our troops, but rather are a way to call attention to an issue that impacts many of them, their families and communities. 

It has been the president's trash talk that has made it into a broader issue, dominating headlines and diverting attention from more important things.

Many of the president's supporters are following his uninformed (or intentionally divisive) rallying cry, echoing his calls for boycotts of the NFL and its advertisers.  Ironically, TV ratings for NFL games this past week have gone up.  And, historically, boycotts of advertisers don't have any lasting impact, if any at all.

Marketers who advertise on NFL broadcasts and/or have tie-ins and endorsements with NFL (and NBA) players face a dilemma.  Do they take a knee by supporting the players, or do they distance themselves by either doing nothing or directly criticizing the players?

My advice – Support the players’ right to express their views.  Good ads and thoughtful statements can keep the issue on topic, making clear it is NOT about disrespect for our flag and our troops.  In fact, marketers can use this as a time to put forth messages of unity that can be inspiring in these times of red and blue division, putting politics to the side and upholding basic American freedoms such as the right to speak out.

Let's see what happens this weekend as pro football returns to the field and the tube.

 

Biggest Advertiser

How much do you save with GEICO?

Everyone probably knows the answer is 15%, for auto, motorcycle and homeowner insurance.

Why do we know the answer?  Because GEICO ads seem to be constant and everywhere - network cable, radio, print and online.

Advertising Age reports that the insurance company featuring the gecko from down under has become the biggest U.S. advertiser, passing longtime champ AT&T.  GEICO, which spent "only" $261 million on ads in 2000 spent $1.48 billion on U.S,. media last year.

No wonder we seem to see their ads constantly.

Do the ads motivate people to buy their product?  Good question.  I would guess yes, which is why they keep upping their ad spend.  The Maryland-based company is now the #2 auto insurer, after State Farm.

 

What We Do ...

 

The National Road Safety Foundation has been around for nearly 55 years, promoting safe driving behavior primarily aimed at teens.

We are proud to work as the Foundation's public relation arm.  But we do a lot more for them than publicity.  We develop partnerships with Federal and state agencies, as well as with advocacy groups like SADD.  We also create and manage contests to get teens engaged in creating and spreading safe driving messages. 

Here's the latest newsletter from The National Road Safety Foundation, which gives you an idea of the scope of work we do for them.  Click here to see the full newsletter.

Creativity in a Bubble

 

A couple of recent missteps by advertisers and their agencies reminds me of how too many ad concepts are created in a bubble.

We all saw the upset that a recent Pepsi ad created when many people thought it trivialized the Black Lives Matter movement and what it represents.

This week McDonald’s faced a twitter-storm over a new ad that’s been running in the U.K.  The ad, critics say, exploits childhood bereavement for a deceased father.  McDonald’s agreed to pull the spot after a huge outcry in England, all of it negative for McDonald’s.  Thanks to social media, the news spread far beyond the U.K., hurting the McDonald's brand.

Another ad, for Nationwide, caused a stir after it aired on the 2015 Super Bowl.  The insurance company had to defensively explain its intentions as social media chatter turned overwhelmingly negative.  Both the Nationwide and McDonald’s ads had a common theme that went awry -- deceased family members.

Why does this continue to happen?

I think it’s because of how ad concepts come to be and how they are presented to clients.  The creative process is, sometimes, hatched and incubated in a bubble. 

Many years ago when I had just started my own PR business, I had an ad agency client.  It was a well-known and well-regarded shop, known for its creative flair.  The agency was invited to present to a potential new client – a copier company.  PR was part of the RFP, so I was asked to participate in the pitch.  The PR component was fairly straightforward – product PR and case histories.

I sat in on the agency’s internal sessions as they were developing strategy and creative for the pitch.  They had just hired a supposed hot shot as EVP and Creative Director and this was the first pitch where he was leading the charge.

The internal meeting where the new CD presented the proposed creative was a big dog & pony show, but honestly, I was not impressed.  In fact, I thought the whole creative concept was wrong and maybe even a bit offensive.

When the CD finished, there was silence in the room.  Finally, someone broke the silence to say he thought it was very creative.  Once the ice was broken, everyone else was effusive about what a groundbreaking and creative idea it was.  I was a bit intimidated and feeling out of my element, so I kept my mouth shut.  I was happy just to be part of the pitch.  But I had my doubts.  Creative, maybe.  But good for selling copiers, or that particular brand of copiers?  I wasn’t convinced.

I remember the day we went up to Connecticut to present to the client.  The agency president introduced the new EVP/CD, reeling off his accomplishments and all the creative awards he had won.  The new guy talked a little about strategy, and then introduced me for the “mundane” PR stuff, sating he wanted to save the best for last.  I briefly presented the PR component, and the client-to-be said it all made sense and they liked it.

And then, the drama having been built up and the “routine” PR stuff out of the way, came the ad creative presentation.   As they were presenting, it just wasn’t making a lot of sense to me.  But these ad hotshots know what they’re doing, I thought to myself, struggling to get myself to nod and smile as the creatives presented.

They finished and then the client’s marketing director got up.  He said, the PR stuff made a lot of sense, but what the hell were we thinking when we came up with the creative?  He blasted the agency guys and all but threw us out.  As I was leaving, he pulled me aside and said he liked my stuff, but he wanted to hire only one team for advertising and PR, so I was out of the running because I was with that agency.

Twenty-something years later, I now have enough confidence to speak up honestly if I were to find myself in a situation like I was back in the internal creative session.  But back then, I figured all these ad guys at a hot agency must know what’s right. 

Now I know that there’s so much sucking up and fear of being the lone man out on the limb.  It’s part of being in a bubble, where people are afraid to speak up.  It’s like that in too many agencies, just as it’s in many corporate board rooms and now, it seems, even in the White House.

The bubble mentality is what probably got these ad agencies, and their clients McDonald’s, Nationwide and Pepsi into hot water.  Hopefully, they’ll learn from this… but probably not.