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Cadbury: Corrie sponsors
Changes to regulator Ofcom’s sponsorship rules, meaning whole channels can soon be sponsored, were generally seen as welcome news by the commercial broadcasters, especially with reports of falling ad revenues across the board. Ever since sponsorship of individual programmes was allowed in the mid-90s, the “message from your sponsor” has become commonplace throughout UK television, with some TV fans enthusing about the idents of some programmes more than the shows themselves. Joanne Oatts talked to sponsorship heads from the big players about the current market and what these changes could mean.
When commercial sponsorship of UK television was given the go-ahead 16 years ago, a lot of viewers were worried that the UK would be subject to American-style, unrelenting, "a word from our sponsor" messages every five minutes. But since Cadburys agreed to sponsor Coronation Street over ten years ago, the idea of a programme being "brought to you by" or "in association with" is something we're pretty used to by now.
In October last year, Ofcom announced that following a consultation, it was to amend its Broadcasting Code to allow the sponsorship of whole commercial television channels and radio stations. In a media climate that has seen traditional spot ad budgets fall, this is clearly welcome, but with programme sponsorship revenues having risen by 30% in the past year, are the broadcasters really going to give over a whole channel to just one brand, and does it make commercial sense?
Sky's head of sponsorship David Shore says the regulator's move is encouraging, but he doesn't expect much to change immediately. "I'm not sure there's going to be a massive rush to sponsor channels. A lot of channels have spent a lot of time and money trying to build themselves up as brands in themselves. Sky Sports is a brand in itself. People sponsor programmes on it because, yes they want to be associated with the programme, but also they want to be associated with Sky Sports."
Gary Knight, ITV brand partnerships director and head of the sponsorship team, agrees, pointing out that he wouldn't want to compromise the existing partnerships it has with this sort of deal. "Even on ITV4 we've got a number of sponsorship deals running, and I keep saying 'how can we sponsor a channel if we've got other sponsors on there already?' So I don't think it's particularly pertinent for us, but for the smaller digital channels, I think it is. By sponsoring a whole channel, you've got to be creating enough viewing to make it work. I think that it's unlikely that I am going to ask for a sponsor for ITV4 or Men and Motors."
ITV has upped the number of deals it has done over the past few years, growing the percentage of sponsorship from 2% of its total revenue to around 4.5%. Knight's team has certainly been busy, closing 211 sponsorship deals just last year. Last September, it sealed a multi-million pound deal with Reckitt Benckiser to sponsor Emmerdale for another year, making it the broadcaster's second biggest sponsorship deal after Coronation Street. And just this week, ITV announced a £1 million TV sponsorship first with McCain to sponsor its Saturday Cooks strand.
So does Knight feel the sponsorship market has changed in this time? "More and more marketers believe that sponsorship is a viable mix of their marketing budget, and I think that's mainly been driven by case histories of other sponsors. We try and set it up as sponsorship deals being part of a wider, 360-commercial franchise, so virtually all deals include online, interactive and mobile." With ITV launching its own broadband portal in the spring, the broadcaster must be keen to exploit the new commercial opportunities this will bring. "As we move into the broadband world, two things happen - for one sponsorship has another life, and there's a lot more sponsorship can do when you move away from linear television. We'll get put in front of even more marketing directors on that basis. People see sponsorship as being very effective, with the equity of two brands rubbing off on each other," he says.
Finding the right sponsor for the right show is part of the process. Coronation Street will be looking for a new sponsor over the next year or so, so the task is on for ITV to find a brand that can fill Cadburys boots. "A far as possible we want to try and find a sponsor and a show that fit together, because on the whole it's more effective. It makes more sense, as opposed to people saying, 'Why the hell is that sponsor with that show?'" Knight says that sometimes they have a sponsor pushing to sponsor a show, where his team can't see how they fit: "Sometimes we get it right and sometimes we don't," he adds.
With some viewers getting as hot under the collar about the sponsored idents as much as the programme content, developing the right creative treatment is of key importance. In-house department ITV Creative does all the trailers for on-air promotions, plus about 30% of the branded sponsorship idents, but Knight says his team are heavily involved in the creative process no matter who is working on the idea.
"I think creative is absolutely key. Just like in advertising, good creativity stands out, and taps into the viewer. We've been around the big London creative agencies, saying 'There's no point doing a great sponsorship deal and chucking away the creativity.' It's just nuts. I think it is one of the biggest issues this year. In a very busy advertising space, with the internet being more cluttered than the TV, you've got to find creativity that really cuts through and shouts out loudly. Of course we don't want to walk into one of our own producers and say, 'We've got this great sponsorship deal, and by the way, have a look at this crap creative work.' So we almost have to sell it into our own producers, as well as sell it in to everyone else," says Knight.
David Shore from Sky concurs, "Creative is key, and I think sponsorship creative is getting much better. People are making a lot more effort and putting a lot more time and resource into it. People are 'getting it' too. Creative agencies are moving away from the fact that they're used to making ads and actually a sponsorship credit is just another way of making an ad."
Sky also gets heavily involved with the creative development of the idents, giving final approval, so that both the channel heads and the brands are happy with the concepts. Over 50% of the sponsorship creative is conceived by the company's in-house department, Sky Creative Services. Representing nearly 60 channels that Sky owns, the Sky media and sponsorship department's key challenge is trying to make sure that agencies and sponsors know what opportunities are on offer. Shore says that a lot of the time is now spent expanding existing deals, and "giving brands more." With Ford having been on board for 12 years, Panasonic and RBS for over four years, making each brand's deal work harder is as important to Sky as getting new sponsors.
Current sponsorship deals amount to 6-7% of Sky Media's total revenue, which puts them ahead of ITV and the rest of the market. This may be down to Sky's sponsorship team being at it for slightly for longer, having had a dedicated department in place for 14 years. "We've been going at it quite a long time. We're probably a little more mature at it, even though some people consider Sky 'new kids on the block', but obviously we do a have a big sport output," says Shore. Big brands certainly do want to align themselves with sport, and with Sky, and the broadcaster has no problems attracting them. Ford sponsors Premier League football; Guinness, the rugby, RBS Sky's golf coverage and Gillette Soccer Saturday.
Across its other channels, the long-established Dominos deal with The Simpsons is still key for Sky One, along with Nissan sponsoring 24 and Yell, its sci-fi strand. Adding to that list is Sky One's recent acquisition of cult US show Lost, which brought it with the show's sponsor 118118. UK viewers got quite attached (or irritated, you decide) to the surreal idents featuring "the ones with the moustaches," produced by creative agency WCRS. Shore says that like the acquisition deal, which saw the show air three weeks after it was announced, the 118118 deal was done "quite late in the day". On the first run of six episodes, the existing idents were used, as featured when Lost previously aired on Channel 4. Though new Sky-produced 118118 idents will be unveiled when Lost returns for the second part of season three on Sky One in a few weeks.
It's clear that we’re going to see an increasing number of deals that include '360-sponsorship' with the brand's name across not only on the TV programme, but the website, the mobile clips, and the catch-up broadband showing. Guy Martin, associate director of commercial development at IDS, the sales house for UKTV, says that one is definitely going to see more targeted ad environments and new commercial models that go beyond traditional spot advertising. "We have seen huge demand for lifestyle programming, with all of UKTV Food's sponsorship opportunities being sold (to brands including Gordon's, Schwartz, Lurpak and Old El Paso), and Topps Tiles sponsorship on UKTV Style now in its fifth year," he says.
Across UKTV's ten channels, each has the benefit of some fairly niche audiences including UKTV Food, Style and Gardens, which are all key opportunities for relevant sponsors. Of all the main broadcasters, these type of channels, with obvious brand affinities, seem to be the most relevant to benefit from the revised Ofcom code. "We welcome increased flexibility in what is a heavily regulated market. Channel sponsorship is a great opportunity for channels that offer very targeted environments," says Martin. "We are already working with the editorial teams, compliance teams and a number of advertisers to develop this area, as long as it does not compromise the revenue we are able to write from traditional programme sponsorship on the channels."
"I think it’s a positive step, but I don't think anyone knows how quickly it will move, but just to have the opportunity to it is a real positive, " adds Sky's David Shore. So we will have to see over time, but don't expect to see Nurofen sponsoring ITV1, or Schweppes sponsoring Channel 4, because for the big boys, their channel brand is more important. Clearly this new opportunity makes more sense for the niche or special interest channels like property channel Real Estate TV, on Sky 279 and NTL, which has been running its channel sponsorship credits for Spanish property specialist Resale Espana since the beginning of January. And one is likely to see an increase in this trend, especially if a sponsor can bring more to the channel than just its brand by helping build and market that channel. As all the broadcasters agree, the main thing is that the regulator, having heavily restricted the commercial opportunities from fizzy drink and fast food advertising recently, is beginning to realise it needs to help the industry find revenue sources to keep it healthy, rather than just be there to restrict them.
This has been Weekend Spy, brought to you in association with large amounts of caffeine.
