Plans are underway for Philippine tycoon Lucio Tan to set up his
own media planning and buying company. True to Mr Tan's low-key business
style, the plan has yet to be formalised, although the group, in a
sense, is already practising media buying via chief media coordinator
Luis Guison.
Mr Guison directly negotiates with suppliers, particularly television
networks and radio stations, to get discounted rates for the ad
placements of the myriad firms under the Tan conglomerate.
The Tan group has interests in airlines (Philippine Airlines), banking
(Allied Bank), brewery (Asia Brewery Inc), cigarette manufacturing
(Fortune Tobacco Corp), hotels (Century Park Hotel), liquor (Tanduay
Distillery) and a host of other businesses.
Mr Guison, advertising director of Basic Holdings Corporation, which
manages several Tan companies, pools together the advertising budget of
companies under the Tan group and with this single though "huge" budget
(industry players estimate it at about one billion pesos) negotiates for
the best airtime rates.
The negotiated rates are then farmed out to the marketing departments of
each of the Tan companies for implementation. Mr Guison said their
advertising agencies, for the time being, still do the actual "buying"
as per the Tan group's rate book and they still get the full
commission.
Mr Guison did not give a timetable as to when they expect to formally
set up the planned media planning and buying company.
He acknowledged that this was indeed the plan and that they are already
in the "first stage".
The current wholesale approach of the group translates into substantial
savings although no figures were available.
"We benefit from the synergies of the group. In the past year our
approach has been especially beneficial because of the rate increases"
by media outlets, Mr Guison told MEDIA.
Another benefit from this pooled media buying is that even the small
firms under the conglomerate, such as Nuggets Food, which have a modest
advertising budget, can benefit from the discounted rates.
"If they went through the normal route they would get the higher rates"
since the media cost would be based on volume, Mr Guison said.
The Tan group has a number of mass market brands which benefit from TV
and radio advertising including Hope, Winston and More cigarettes, Beer
na Beer and Tanduay Rhum.
"In the order of priorities, TV would be our primary medium, followed by
radio. Print comes in at a distant third," Mr Guison said.
The reason for this is sheer numbers, he said, with TV and radio in the
Philippines reaching millions of viewers nationwide with newspapers and
magazines having a limited reach.
