on commercial load - gma7 misses the point : part 2

the press statement of gma7 on the issue of commercial load on tv programs is a lame attempt to justify or rationalize their action. assuming they mean what they said in the press statement, the only other viable conclusion is gma7 is missing the point on why the KBP has imposed a limit on commercial load in tv programs.

it's not about financials or revenues or as they call it "restraint of trade" that is being imposed on them by the KBP, it's about avoiding audience fatigue on watching too many commercials.

the audience watch tv to watch the tv shows, not the commercials. commercials shown in these tv programs are a disruption to the enjoyment of the tv shows by the audience. loading tv programs with too many commercials will force the audience to tune off when the ads are shown. tv commercials actually is actually an irritant to tv watching.

by now, the audience know that a commercial break will have 4 to 6 commercials and with the tv remote in their hand, the audience will probably change channel at the latest on the 2nd commercial that is shown. that means there will be a lot of ads in that commercial break that viewers will not watch.

that is not good for the ad industry. as abrera has said, by now it's possible this overload of tv ads would have taught the audience a new habit of zapping out of tv ads. what good will that do to the ad industry?

my point of view is that the broadcast industry should impose a low number of commercial load. to compensate, tv stations should increase their cost per spot accordingly so that the total revenues they earn from the total commercial minutes will be the same. if for example they now have a commercial load of 6 ads per gap, and they charge P200T/spot for a total of P1.2M per gap; they should reduce the commercial load to just 4 ads per gap but increase the charge to P300T/spot for still a total of P1.2M revenues per gap. no loss of revenue for the tv station but a more pleasant viewing experience for the audience and a better appreciation of the ads.

i think the ad industry as a whole will benefit more in the long run with less ads on tv. so what if the cost per spot goes up? that's a good thing. tv advertising is not for every client, we don't have to make it affordable to small clients or brands with small budgets. the truth is there are just too many brands advertising on tv who go on air just for a very short airing period for lack of budget. if the ad agency will be honest about it, the truth is airing a tv ad campaign on a short airing period is as effective as not airing a tv ad at all.

increasing the cost per spot of tv ads to the level of making it unaffordable to small clients and brands with small budgets will force ad agencies to be honest with their clients and will stop ad agencies from recommending tv advertising to all of its clients just for the sake of earning revenues but no real impact on business building.

tv is not the only advertising medium available for clients to use. and in fact media other than tv in many instances are a better fit for some brands and definitely more cost effective.

making cost per spot very prohibitive will also force ad agencies to work harder at coming up with better and more creative tv advertising. with it's cost very high, clients will now be more demanding on their ad agencies when it comes to tv ads. clients will say, you're making me pay so much for tv ads, you better make sure you come up with great ads.

also, the tv stations should know commercial air time is a seller's market. there are only two viable tv stations in the country, ABS-CBN and GMA7. the ad industry has no choice but to buy commercial air time from them. they can sell their tv spots at P200T/spot or P500T/spot and the ad agencies and clients will continue to buy them. they have no other choice.

just to illustrate the point i am making - look at the super bowl in the US. 1 30 second tv spot in the 2008 super bowl cost P2.7 Million! super bowl commercial airtime is the highest cost in all of TV in the US.

and guess what? the ad industry and clients continue ro buy commercial airtime in the super bowl, cost per spot does not matter. why not? that's because the super bowl has a very high audience rating, the highest in the year. that is also true in the philippines - ad agencies and clients buy spots based on audience rating. they will buy into a tv show no matter what the cost is as long as it delivers in audience rating.

what about the quality of the ads aired? clients and ad agencies air the best and the most creative ads during the super bowl. looking for the funniest. most memorable and most effective ad during the super bowl has become a side tradition to watching the super bowl for the audience. day after the super bowl the audience don't just talk about the great plays in the super bowl, they also talk about the great ads they saw during the game.

airing the best ad during the super bowl has even become like a side competition among the ad agencies. their work getting ranked as best in the super bowl earns them prestige and precious bragging rights.

and that is the point i am making here. if philippine television makes it's cost per spot higher but lower the number of commercial load per program, the audience will be happier and will watch all the commercials making the ads more effective in doing their job. and because it involves higher cost for clients, it will make them demand better quality ads from the ad industry.

the net effect will be : better quality and more effective ads and a happier audience. isn't that what we all want?

gma7 refutes KBP ad load rule

this is next in WAWAM! : the tv remote vs the greed of tv stations part 2

read part 1 here : http://the-wawam-file.blogspot.com/2008/06/tv-remote-vs-greed-of-tv-stations-part.html

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GMA 7 refutes KBP ad load rule
By Riza T. Olchondra
Philippine Daily Inquirer

First Posted 03:06:00 04/13/2008

MANILA, Philippines - GMA Network, Inc. said on Wednesday that the Kapisanan ng mga Brodkaster ng Pilipinas (KBP) rule limiting the commercial load of programs to 18 minutes per hour will push commercial airtime prices up.

The network, which left the KBP in 2003, also said that the cap violates Philippine laws.

“A limitation on the supply of the very limited resource of commercial airtime would push commercial airtime prices upwards. Thus, time standard disrupts market forces that dictate supply and demand and is anti-competition,” GMA said in a statement.

Manipulative

Citing local and US laws, GMA also said that limiting the number of minutes per hour for commercials, among others, “had the actual effect of manipulating the supply of commercial television time.”

The network views the time standard “as a form of combination in restraint of trade and therefore violative of the Constitution and the Revised Penal Code.”

GMA officials could not be reached for comment regarding the network’s ad load, revenue from ads, and ad rates.

Full support

Last month, KBP member ABS-CBN declared full support for the ad load cap. “The limit safeguards the public from possible abuse by broadcast organizations,” ABS-CBN corporate communications head Bong Osorio said in a statement.

“Limiting the number of TV and radio spots lessen the advertising clutter; thereby, making the ads more effective,” he added.

ABS-CBN head for business analysis Vivian Tin said on Tuesday that the ad load limit will not pull down the company’s ad revenue. “Last year, though KBP gave a little bit of leeway to the cap—to 20 minutes— we did not go beyond that out of respect for the audience. Between the price increase and the increase in number of minutes that’s coming out in terms of demand ... we think airtime revenues will grow healthily even at 18 minutes.”

Last Tuesday, ABS-CBN announced that it is raising ad rates by 15 percent, subject to negotiation with advertisers.


http://showbizandstyle.inquirer.net/entertainment/entertainment/view/20080413-130041/GMA-7-refutes-KBP-ad-load-rule

the tv remote vs the greed of tv stations : part 1

gma7 fought with the advertising industry and the kbp on too much commercial load a few years ago. the kbp fined gma7 for putting too many commercials into its tv shows, violating kbp guidelines on the maximum number of commercials allowed that was followed by the industry.

the kbp, like the adboard is a self-regulating body created by the industry itself and everyone for many years have followed its rulings and guidelines. gma7 was adamant with its stand, saying first they did not violate the rules then later on when given evidence said they said were not bound by the rules of the kbp. when it was clear that gma7 will be sanctioned by the kbp and supported by the advertising industry, gma7 did the most despicable move that demonstrated guilt - it withdrew its membership to the KBP so that it is no longer bound by it's rules and regulations.

i thought that was a dumb ass move that would eventually not only hurt gma7 but more importantly hurt the broadcasting industry and advertising as whole. i felt gma7 was simply satisfying it's greed for revenues and profits (more commercial load, more ad revenues) putting the broadcasting and advertising industry in jeopardy. in satisfying it's gluttony, it was killing the industry that it was getting it's food from.

more importantly, i thought that move will eventually hurt the tv audience. let's not forget, people watch television for the shows, not the commercials. ask any tv viewer and i'm sure 100% of them will probably say they prefer not to watch commercials at all.

aside from the unwatchable tv shows, the large number of tv commercials in a show are two reasons i hardly watch local tv stations. i prefer to watch cable tv where there is a tolerable number of interruptions. i usually force myself to watch local newscasts and when i do that, the tv remote is always in my hand and would switch channels every commercial break. i am practically on a commercial free viewing, thanks to my tv remote.

and that is what i find as most striking in what abrera said - "when we overload shows with commercials, we are actually teaching the audience to avoid them".

tv watching is not just a behavior, it is essentially a habit that modern humans have formed. it is formed over time and through constant repetition. habits are formed when humans acquire something good or pleasurable out of it or on the other side of it, to avoid something bad or unpleasant.

the latter - avoidance of something bad or unpleasant is what abrera is referring to when she said "we are actually teaching the audience to avoid them". every tv has a remote these days and that means every audience has one in his hand. the power to watch or not to watch anything is literally in the hands of the audience.

that is the impact of what gma7 did. it's over and beyond revenues, fighting with the KBP or fighting with the ad industry, it's affecting audience behavior, the group everyone i mentioned above are after.

any marketer and advertising practitioner know that the core of what we will do is first affecting an attitude change that will lead to a habit change, forming a new one or changing an old one.

gma7 for sure knows that. and it is sad that one of the two largest tv networks in the country is involved in the formation of a new habit that will hurt not only itself but most specially the whole ad industry. if abrera is right, and i think she is, it looks like gma7 gave itself and the whole ad industry a poison pill.

gma7? a WAWAM!

more on this, next in WAWAM!...

too many commercials turning off viewers

this is an interesting comment. up next is the view from WAWAM!


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Advertisers losing audience in RP due to too many commercials

By ISAGANI DE CASTRO, JR.abs-cbnNEWS.com/Newsbreak

The Philippines has too many advertisements on television, and consumers have adapted to it by changing channels and returning to programs they like just at the right time with their remote controls, a leading advertising executive said.

In an open forum at the 2008 World Marketing Conference at the SMX Convention Center, Emily Abrera, regional chair of the McCann Worldgroup Asia, said the Philippines has the highest commercial load per hour in Asia. “We have the highest commercial load in the world. Certainly, it’s the highest in Asia, and I think it’s probably one of the highest in the world,” she said. In an interview with abs-cbnNEWS.com/Newsbreak, Abrera said the local advertising-industry prescribed limit is 18 minutes of commercials per hour, a level that is already highest in Asia. In other Asian countries, the limit is 12 to 14 minutes per hour.

Anti-ads behavior

Abrera said too many commercials have forced consumers to adapt, and they have developed behavior that is anti-advertisement. “You will note that people are continuously watching several channels simultaneously. And people are very good and have evolved this wonderful sense of timing so that they know that as soon as commercial come on, they go to the channel where they’re watching something else. So in other words, they’re tracking several programs at the same time. And they come back, almost as soon as that last spot is ending. They’re very good at that already,” Abrera said. “When we overload with commercials, we are actually teaching people how to avoid them. We’re giving them the greatest reason how to avoid watching our work. And that is what worries me the most, that we’re losing our audience for our commercials,” she said.

Regulation needed

Abrera said there is a need for more regulation of these commercials in the Philippines. The regulation is supposed to be done by the advertising board in the Philippines and the broadcasters’ association, Kapisanan ng mga Brodkaster ng Pilipinas (KBP). “I still think we need to be regulated,” Abrera said. But she lamented that GMA-7 is no longer a member of KBP, “so we can’t hold them to the following guidelines.”

According to a content analysis-study done by De La Salle University students discussed during the open forum, GMA-7 has a commercial load of 30 minutes per hour while ABS-CBN has a commercial load of “15 to 20 minutes per hour.” Abrera said marketing associations in the Philippines are “trying to find a balance” that would allow television networks to comply while reducing costs to advertisers. She said the balance is needed because “the fewer commercials we have, the highest cost it will be for a commercial minute or 30-seconders.”

New technology factor

She said the industry cannot continue with the same set-up of overloading consumers with commercials. “It’s something that needs to be addressed. And we cannot continue interrupting programs. Because that also interrupts viewing and creates a sort of a negative effect after a while.” Abrera said new technologies such as mobile phones are partly to blame for the commercial overload. “I don’t think it’s just in the Philippine setting.

I think we’re just inundated with messages from everywhere, because also of new media, because we carry our phones all the time. So we get all sorts of offers, promotions. If you look at the billboards which are just all over the place, it’s as if there’s nowhere you can turn where there isn’t space that is occupied by a branded message. And this I think teaches us also how to tune off,” she told abs-cbnNEWS.com/Newsbreak.

Creative ads

Abrera urged advertising and marketing firms to be more creative in their campaigns through ads that consumers won’t mind being interrupted with. “We’re going to have to perform the job of entertaining, uplifting with a very subtle sell,” she said. “The message has got to be worth their time, worth their interruption.”

Abrera said young people know so much about producing videos these days that it makes the job of advertisers more difficult. “They know so much about production that you’re going to have to show them something so interesting that they’re going to want to see it over and over again,” she said. Abrera said another challenge is how to produce advertisements for computers or laptops, Ipods, and mobile phones, which consumers don’t want interrupted with commercials.

“The other thing we have to realize is, these new media—computer, the mobile phone, iPod—these are very personal, extremely personal.They’re extensions of the self, and so there’s a higher wall there that I think we have to scale, to enter,” she said. This is a big change from the time when all advertisers had to do was “just buy and pay for the space and you can intrude on anyone at any given time." “Today, they have to give us permission to deliver our message,” Abrera said.