So the Seven Network is now in such a revenue-rich position it can ignore paying advertisements from competitors such as rival magazine group, ACP (part of the PBL empire of Kerry Packer) and now a story in the Sydney Morning Herald makes you wonder if Seven’s revenues have swelled to such an extent that it can afford to ignore or reject those Packer dollars.
The story starts with the launch of ACP’s new Madison magazine a week ago last Monday and a cleverly bought ad in the high-rating episode that night of Seven’s hit, Desperate Housewives. Crikey pointed this out last week that the episode of Desperate Housewives rated its socks off, attracting an average 2.3 million people, over half women and the top-rating program of the week. A good buy by ACP’s agency, Zenith. It’s what you pay media buyers to do, if you’re an ACP (or Seven for that matter).
It seems from the SMH story and industry chat that Nick Chan, the head of Pacific Magazines, the Seven magazine group, also spotted the ad because ACP has found it harder to get space in these high-rating programs on Seven. In fact it is now impossible!
It was strange that ACP managed to slip its Madison ad into Desperate Housewives in the first place, seeing how Pacific’s Marie Claire has been running a big promotion to lift its profile as Madison launched. Was someone asleep at Pacific, enjoying the views from Milsons Point?
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It would seem Pacific just forgot (or someone higher up in Seven) to book ads in programs that Madison was targeting in its launch quest to reach women like. Programs like Desperate Housewives and Dancing with the Stars. There’s nothing like being there first to deter a competitor!
Seven now has a ‘floating rate card’ for programs like these, meaning rates rise with demand and they have. Seven claims it is this ‘clamour’ of advertisers bidding for spots on these high rating programs that meant ACP couldn’t get set again. ACP’s ad agency says the ads were knocked back by Seven who told the agency that it was not taking any more bookings and that the original slots booked had been cancelled. That’s an interesting move.
Seven says no directions were given in relation to Madison, but with Seven’s earnings slumping in the first half to only $43 million (about half of that was made by Pacific with lifted gross earnings 50% or so to some $22 million) you’d think Seven would want every dollar it could get its hands on.
But the ACP and PBL complaints are crocodile tears. By complaining about the ads being pulled ACP and the women’s publisher Pat Ingram are in effect saying there was no TV shows that better fitted their marketing profile for Madisonthan Desperate Housewives and Dancing with the Stars. That means they were saying there was obviously nothing on Nine (although the CSIs do well with viewers and women young in the 16 to 39 age group, which does capture the Madison demographic), there is nothing like Seven’s shows.
Nine and PBL also don’t have the best of track records in accommodating ads for rival products and with New Idea’s sales doing slightly better in 2005 than Women’s Day, there’s no doubt some sensitivity at ACP in Park Street and Pacific at Milsons Point about getting the best marketing mix.
Seven Network is also looking at a big jump in costs this half – 10% or more by some analysts forecasts, taking the ACP dollars would have been sweet and profitable.
The ways of our media companies are curious indeed.