Heavy media agency workloads from proliferating media choice has hit public broadcaster SBS, which said its ability to strike cross-platform advertising deals was getting tougher as agencies opted for easier options with commercial broadcasters.
Media agencies are under the pump dealing with the array of new online and digital TV channels - most are reporting 40-50% increases in the number of TV spots they have to buy to reach the same number of viewers as three years ago.
“The impact of fragmentation is that they’re spoilt for choice but also swamped with volume,” SBS director of advertising sales, Mark Fairhurst said. “At the moment buyers are trying to cope with volume and they’re less inclined to want to talk about multiplatform or integrated campaigns. It’s an adjustment process but we’re certainly feeling at the moment it’s harder to have those conversations than it was.”
Fairhurst said the three commercial broadcasters were probably benefiting because it was easier for buyers to bundle cross-platform deals with those operators than to develop initiatives with other media sellers. Or they were simply buying more TV spots to cope rather than have to juggle more complex and time-consuming cross-media executions.
He also said the age profile of agency media buyers meant SBS was less of a priority than it was for advertisers because younger people watched less SBS. “[Advertising] clients tend to engage with SBS more often than media buyers,” he said. “It’s probably a similar challenge to what newspapers have got. The demographics of media buyers tend to be a little younger.”
Fairhurst noted market demand for TV airtime had turned more cautious and said the 5-6% growth revenue forecasts for TV this year would “come off a couple of points”. “I’d like to see some improvement in the back half but all the data we’re seeing at the moment around retail spending and consumer habits says it could be a little softer than we anticipated. We grew double digit through the GFC when the market went backwards. As it rebounded we’ve held our line.”
SBS ad revenues for the 2010-11 financial year - excluding last year’s spike from the FIFA World Cup - would be flat. SBS does not breakout TV ad revenues but it was estimated to be around $60 million in the 2009-10 fiscal year.
Fairhurst said flagship TV events like the Tour de France was facing more competition for sponsors because of the Rugby World Cup but that three deals had been signed off – Skoda, IG Markets and IAG – with one other close to completion.
SBS’s programming strategy was continuing with its “key vertical” approach across food, film, football and documentaries.
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