TEXT OF INTERVIEW
KAI RYSSDAL:The major television networks wrapped up their big advertising presentations this week. The upfronts, they’re called. When the networks announce their fall schedules in the hopes of snaring some big money from advertisers, upfront. Ad buyers will start actually paying for commercial time on those shows in the next couple of weeks. But the pitches from the networks this year haven’t just been about the content. They’re promising new ways to make the ads stand out. Michael Burgi is the editor in chief of Mediaweek magazine. Welcome to the program.
Michael Burgi: It’s great to be here, Kai.
Ryssdal: So I imagine we all know what product placement is. You know, the example that’s most current is the Coca-Cola cups on the desks of the American Idol’s judges, right? Sneaking those products in there. But now there’s this thing called “TV in context.” What is that?
Burgi: I think TV in context is just taking that a little bit farther. As viewers are watching TV through their DVRs and they can skip the commercials, the networks have kind of figured this out. And so therefore, they embed the advertiser into the programming and then embed the programming into the advertising.
The cable network Bravo is really aggressive at this, where if you’re watching “Top Chef,” you’ll suddenly see a vignette of some hilarious moment on “Top Chef,” where someone cuts their finger off or whatever. And they’ll show that in the middle of the commercial break. So anyone who’s using a DVR and is fast forwarding through those ads, they think the programming’s returned, so they stop and they watch this little bit of programming and suddenly they go back to more ads.
Ryssdal: Now that’s so funny, because when that happens to me, I get just annoyed.
Burgi: I think a lot of people get annoyed. But most people will still kind of watch those ads, just because they don’t know how many ads are left. You don’t want to go past and too far into the program, because then you’ll have to rewind. So I think it’s a pretty clever move to now blur that line even more, so that you can’t easily skip through the advertising.
Ryssdal: How else are those lines being blurred. What are we going to see this fall?
Burgi: We’ve got a great example this fall on NBC, where Subway has essentially bought its way into the TV program “Chuck.” Now, a little background, “Chuck” is a troubled program. It’s not getting great ratings. One way to help keep that on air is to help subsidize the cost of the programming by bringing an advertiser in, and working that advertiser in. Now are we going to see a Subway sandwich picking up a gun and shooting at someone? No. But it’s going to get worked in the programming, where when someone’s sitting at their desk eating something, you’re going to have that Subway logo very clearly visible.
Ryssdal: Does this work? I mean, does it make people go out and buy the $5 footlong from Subway?
Burgi: I don’t think it works any more or less than advertising has. I mean, you go back to the classic, over-quoted Joseph Wanamaker quote about, “I know half of my advertising works. I don’t know which half.”
We still have not answered that question. No one has. But if Subway’s numbers go up, then they’re going to go, “Yeah this advertising kind of worked.”
Ryssdal: How much money are we talking about here? Last year I think the figure was $9 billion out of the upfront. Is it going to be that much again?
Burgi: It really depends on how the networks approach this market. The buying side — those people who are looking to buy that ad time — are telling the networks, “You better be reasonable.” Because nobody wants to spend more money than they did last year, when the viewership is down and everyone’s budget’s are a little tighter.
And the agencies have plenty of other options to go to — whether it’s buying digital inventory, which is less expensive — or going into, what we call the “spot TV marketplace,” which is buying at the TV station level, instead of the network level. TV stations are sucking on wind for any kind of revenue they can get. Their pricing has dropped 20, 30, 40 percent.
But I think the networks are ultimately going to have to get more reasonable with their pricing. And we’re going to see a network TV marketplace in the upfront that will be below $9 billion, I just can’t say how much below it.
Ryssdal: Michael Burgi is the editor of MediaWeek. Michael, thanks a lot.
Burgi: Oh, it’s a pleasure. Thank you.
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