"We don't have all the layers of people like the ad agencies do so that's why our costs are so much lower,
says Kitcher.
Some channels in Singapore are also developing an enviable creative reputation, winning prizes at Promax & BDA, an international award show for creative excellence in broadcast media, and other competitions that were once the sole domain of agencies.
Kitcher claims his staff are "top-class marketers
at building brands for broadcast companies; they are now simply using these skills to help sell a client's products and services.
In these recessionary times, the hook for advertisers is that TV stations usually do the creative work for free if a client spends a certain amount on advertising.
The creative is usually tailored to reflect the programming environment, but advertisers also have the option to run the creative on other channels.
Fierce competition between channels has been the main impetus prompting TV ad sales representatives to offer extras to land advertisers. On-air promotion departments also want to demonstrate they are not simply a cost centre but can generate extra revenue for the channel. Kitcher says doing quality work for clients helps to ensure advertisers choose Discovery over the competition.
Media agencies, which are now less beholden to their ad agency siblings, like recommending these value-added packages because it demonstrates they can be creative in their approach and move beyond the standard spot-buys.
These deals can also be financially lucrative because the media agency stands to earn extra. Production cost can be factored into the media bill, which means that a media agency is in effect getting commission on the combined media and production bill.
Some advertisers want to work with the channels because they are keen to find innovative new ways to get their message across on TV rather than rely solely on TV spots.
Going direct to the TV station offers cost savings and is sometimes the only way an advertiser can afford to be on TV. Citizen watch, for example, asked Discovery to create a TVC promoting its pro-master watches because it "didn't have the budget to go through the usual (ad agency) channels", says Kitcher.
At other times, TV stations offer their services to encourage new advertisers - such as those who only use print - to try TV, says D. Sriram, managing director of Starcom in Singapore. An advertiser "may not feel comfortable investing money in producing a TVC so the stations usually do it for free if the advertiser spends something like S$250,000 (US$134,000)".
CNBC, for example, has done TV commercials for about 25 to 30 clients this year across Asia, including video conferencing company Polycom and data networking company Datacraft. Many of its clients normally only advertise in the business press so creating a TVC is one way to encourage them to move to TV. The strategy is paying off - two years ago CNBC only created TVCs for about 10 clients.
But "the creeping phenomena", as one ad sales rep calls it, is causing anxiety among ad agencies. Echoing the sentiment of his peers, Robert Murphy, Euro RSCG executive creative director, describes the situation as a threat. "Agencies are under threat from so many companies ranging from management consultants through to specialists such as digital marketing firms so I guess TV channels are just another although they are a minor threat."
He was quick to highlight the faults in the TV stations' offerings.
"The pay-TV production guys lack the back-up in terms of strategic thinking and resources,
says Murphy. "They're not dealing with long-term branding issues; they're just doing one-off tactical projects. Those trying to save money by going to a TV station are taking a short-term myopic view."
Clients need to work with agencies and take a more holistic approach by considering all the communication channels, he says. "An on-air billboard or vignette may not solve the client's (marketing) problem."
