Media Analysis: Coverage Is the New Currency

Marketing, January 12, 2005 | Go to article overview

Media Analysis: Coverage Is the New Currency


As multi-channel TV extends its reach, ratings will be overshadowed in media planning in 2005.

Thanks to the canny early-evening scheduling of its Harry Potter blockbuster, BBC One, to nobody's great surprise, beat ITV1 in the annual battle for Christmas Day viewers. Yet two, more significant, statistics illustrate how irrelevant this war is in today's TV market.

In the week ending 2 January, the multi-channel audience exceeded that of BBC One for the first time (30.7% to 24.7%). The BBC paid a hefty price for its Hogwarts coup - part of a controversial pounds 12m US movie rights purchase - yet its claim to be the home of UK family viewing, one of the key arguments in its defence of the licence fee, is looking ever more hollow.

The second illuminating statistic is that, in the same seven days, Sky beat Channel 4 over a week's schedule for the first time. Sky-branded channels took a 9.6% share, compared with Channel 4's 8.4%. What is more, the three terrestrial commercial stations saw their combined share over the Christmas and new year holidays fall by one percentage point on last year to 35.4%.

Limited impact

Aside from post-Christmas sale advertisers, few will lose sleep over these statistics. Commercial broadcasters traditionally downweight their programme schedules over Christmas due to a lack of advertising. In any case, events over Christmas may have clouded the picture. Sky's victory over Channel 4 was due in no small part to viewers tuning in to Sky News for coverage of the Asian tsunami - the station's audience was up 50% year on year.

Nevertheless, one message does come across loud and clear: there is a continuing exodus of viewers from terrestrial channels to niche programming, even at a time when viewers are most likely to watch in family groups and, therefore, most likely to tune in to the mass-appeal fare provided by the terrestrial stations. The implications for FMCG advertisers and others seeking a mass, multi-demographic audience, are obvious.

Chris Locke, Starcom UK group trading director, says these advertisers will have to combine terrestrial and multi-channel TV in the right balance and with the right communications. Since achieving sufficient coverage on multi-channel involves the scheduling of many more spots, he argues that more creative variations will have to be employed to avoid viewer boredom. 'Media planning will need to be more clever,' he adds. 'The trading currency is changing from ratings to coverage, and targeting the right programming at the right time of day will become ever more crucial.'

Reduced losses

The trend away from terrestrial is exemplified by ITV's fortunes. ITV1 finished the year with an audience share loss of more than 3% and stands to lose pounds 100m in revenue in 2005 under Contract Rights Renewal rules.

However, aggressive promotion of its successful digital stations ITV2 and ITV3 in the current annual trading round is expected to stem the overall ITV revenue loss to between pounds 30m and pounds 50m.

It is an admirable achievement, but media buyers believe that ITV has been storing up problems that will return to haunt it in the future. …

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