The result is at the lower end of overall expections, particularly considering the 15 per cent spike recorded in 2006. and the fact that the Beijing Olympics will take place in 2008.
Procter & Gamble again topped all bidders, this year spending Rmb 486 million, ahead of Yili’s outlay of Rmb 374 million.
The mainland dairy giant chose to double its 2006 spend this year, perhaps safe in the knowledge that its key rival, and non-Olympics sponsor Mengniu, would again avoid direct confrontation - spending just Rmb 197 million.
China Life Insurance ranked third, spending Rmb 278 million.
While most of the Olympics airtime had already been auctioned off to sponsors in September, residual airtime clearly fuelled bidding at this year’s auction.
Traditionally, July and August mark the low season for TV airtime revenue. In 2007, spend for these months increased just one per cent over 2006, compared to the 47 per cent surge - to Rmb 330 million - for 2008.
“Many of the MNC players were at the auction, but they were outbid by more aggressive local companies,” said R3 principal Greg Paull.
“Mainland companies tend to over-invest in CCTV compared with their foreign counterparts, which spend around 20 to 25 per cent on CCTV, whereas top local companies spend 50 to 70, or even 100 per cent, of their media buying budget on CCTV, as it still has the cachet appeal for them. International companies like Coca-Cola and Pepsi are starting to make use of regional satellite TV stations.”
Highly-rated time slots like weather and news reports as well as CCTV dramas also triggered strong competition. Qingdao’s Sinatra Diary paid Rmb 158 million to scoop rights for seven months for one of CCTV-1’s primetime dramas.
Meanwhile local FMCG giant Nice Group outbid Mengniu to secure whole-year rights for another, spending Rmb 229 million.
“One of the highlights from this year’s auction was to see the category of brands has expanded to a wider range of industries,” said China Media Exchange MD Warren Hui.
“Apart from FMCG, finance, cosmetics and pharmaceuticals, we are seeing newcomers from the household appliances category, and other products related to the lives of ordinary people.
“The advertising clients base for CCTV has expanded.”
While the Olympics helped to prop up this year’s results, concern remains over whether, post-Olympics, a slowdown will materialise at next year’s CCTV airtime auction.
“There are limited resources that CCTV can increase, as other platforms - notably new media - are also competing for the same media spend from brands and media agencies,” said one media agency source.
“CCTV is also facing competition from its regional TV counterparts. CCTV needs to produce more innovative programmes and advertising packages to lure the eyeballs of both viewers and advertising clients,” added the agency source.
“Simply saying ‘Believe in the power of brands’ - which the auctioneer repeated all day - may not be enough.”
Premiums climb
Official Olympic sponsor China Airline won bidding for the 15-second commercial slot during the weather forecast in the Olympic month of August with a bid of nearly Rmb 37 million. This represented a premium of 30 per cent for that month.
Multimedia deals
Energy drink Red Bull paid Rmb 159 million to purchase space in Olympic-related programme Star of Today through July and August. The package covers not only TV airtime, but also exposure on CCTV’s website, newspapers, IPTV, HDTV, and mobile marketing, indicating that the national broadcaster is offering increasingly integrated marketing platforms.
Sports labels jostle
Nike spent Rmb 72 million for exposure during live Olympic broadcasts, while local sports brand Li Ning spent 50 per cent of its media budget by sponsoring all presenters on CCTV 5 (Sports Channel) to wear the brand on air. But with another local sports brand - Xtep - investing close to Rmb 104 million on CCTV’s live broadcast package, clutter is likely to be an issue.
