The major regional cable and satellite television operators appear
to be defying gravity as they continue to aggressively expand
distribution and programming in the midst of what is being described as
the worst economic downturn in decades.
But in the battle for market share, the big players can neither stop nor
slow down what they had set out to achieve five or 10 years ago. A move
by any one of them to ease back on the gas pedal would only give rivals
the opportunity to race ahead and grab a superior competitive
advantage.
With pricing plans for viewers extremely competitive, the major
operators are focusing on advertisers to ensure their long-term future.
But as clients become ever more cautious with their marketing
communications budget, more flexible and value-added advertising
packages have been formulated to stave off deep discounts.
The result has been continuing rapid expansion into new geographical
areas and a slew of unique sponsorship deals around special
programming.
Although the drive for success has intensified greatly over the past
year, regional channels are keenly aware of the fine balancing act they
walk - being creative without being intrusive - in the battle for
viewers.
MTV Asia's MTV Asia Music Awards is a case in point. In previous years,
the event was staged in the major markets of China, the Philippines and
Taiwan. This year, for the first time, the show is being staged
pan-regionally and this strategy attracted two major Asia-wide sponsors
targeting the 15-34 market - Panasonic and Mitsubishi.
The channel's vice-president of network communications, Jessica Kam,
says: "This award show isn't just about a billboard of singers; it's
about facilitating viewers in eight markets to vote for their favourite
stars through multiple platforms, including 350 outlets, the internet
and mobile phone SMS technology."
In the first two weeks, four million votes were cast, and it is this
level of participation, which MTV hopes will attract more advertisers
from individual markets, such as Smart Communications in the
Philippines, ahead of the announcement of the winners at a gala
presentation in February.
National Geographic jumped on the discovery of the fossil of the world's
largest crocodile and set in motion a marketing juggernaut of
through-the-line activity. This included having to transport a life-size
model of the reptile - roughly 12 metres in length - to various
exhibitions around the region, attracting a major brand like Federal
Express to come on board as a sponsor because the courier giant believed
it could amply demonstrate its versatility in the business logistics and
transportation game.
National Geographic Channel Asia vice-president of sales and marketing,
Deborah Armstrong, said the sponsorship offered a huge cross-platform
opportunity - exhibits, exhibitions, kits, maps, books, website as well
as television - which leveraged off National Geographic's heritage of
highlighting the unusual and historic finds of explorers and bringing
them to people in "an enriching and entertaining way".
Other examples of creative but unobtrusive advertising packages include
ESPN Star Sports' Super Selector Fantasy Cricket Game, AXN's Action
Movie Festival and CNBC Asia-Pacific's Asian Business Leader of the Year
Awards.
The big broadcasters have also continued to enter into new markets to
sharpen their competitive edge. Some of the more recent have been
National Geographic's rollout in Japan on the Sky Perfect TV! platform,
AXN's launch in Malaysia via pay-TV operator, Astro, and Channel V
forming an alliance with Space Shower Networks, Japan's leading music
network.
But as the big broadcasters venture further afield, they have begun
laying off staff in their headquarter offices and replacing the
headcount with hires in their outpost operations.
As CNBC Asia general manager of marketing communications Miguel Bernas
puts it: "Economics has something to do with it but operational
necessity dictates that we have people on the ground in those locations
in order to function more effectively and to react to local market
changes in a timely and appropriate manner."
However, there is more to geographic expansion than meets the eye. It
not only pulls in a critical mass of viewers but with the appropriate
technology allows for market-specific feeds, which give advertisers
options that are not readily available with other media.
"We can slice up our market any way our advertisers want - regionally or
if they want the region ex-Japan, or Taiwan and Southeast Asia only,"
says AXN managing director Todd Miller.
But Miller emphasised the importance of the functional link between
viewer numbers and how markets can be offered to advertisers.
"Increasing viewership extends more value to advertisers. Different
market mixes gives advertisers more targeted options. In this way, we
provide more value, diminishing the need to resort to discounts."
Star's executive vice-president of advertising sales, Toby Hayward,
added that split feeds are "highly-targeted to local advertisers". He
said there was "no wastage", meaning that not just regional or
sub-regional advertisers can be targeted by satcasters, but also local
advertisers which would help them to diversify into new categories.
These efforts have been stepped up since the terrorist attacks on the
United States in September. Both BBC World and CNN have acknowledged
moving in this direction but both are tightlipped on specifics, although
they did say that airline and travel ads had rebounded and that the
automotive and IT sectors were also buoyant.
BBC World Asia-Pacific account director, Sally Young, says: "We were
looking at secondary markets and categories because the economic
slowdown and 9-11 mainly affected the primary markets, where
multinationals are located."
The channel's director of airtime sales Jonathan Howlett adds: "We've
tried to be more broadbased and the strategy for some time, even before
September 11, has been to get out there in a big way to demonstrate that
there is a huge and high quality audience watching television news."
Nick Morgan, senior vice-president for news advertising sales at Turner
Broadcasting, agreed, adding: "It is imperative now more than ever
before to demonstrate value to customers.
"Just saying you're No.1 here or there means nothing to advertisers. You
must understand how to sell the customer's widgets, whether it's
television, the internet or print, and then prove your
effectiveness."
The major satcasters reported a large slide in advertising revenue
immediately after 9-11, however, they claimed that November figures have
rebounded strongly. They predict operating conditions in the first
quarter of next year will probably be harsh but believe that a solid
recovery will begin by April.
