Branded Entertainment Prices Hitting the Fan
The Association of National Advertisers said 63 percent of its 118 marketers have used branded entertainment, but only 11 percent say they'll do another deal again this year. Worse still, a business-crushing 79 percent say branded entertainment stuff is overpriced.
And you know what that means? More sharpened pencils up and down Sixth Avenue - especially those that will write higher CPMs for traditional 30-second spots to be sold during this upfront.
Mark Kaline, global media manager who specializes in branded entertainment deals for the Ford Motor Co., said it best when it comes to branded entertainment, according to The Hollywood Reporter: "It's 25 percent of the press, but rarely 25 percent of the (marketing) budget."
Make that less than 5 or even 1 percent most times.
One point the survey didn't explore fully was the problematic 'return on investment' measuring tools branded entertainment marketers desire. Other problems still exist, such as making the zillion phone calls in getting branded entertainment deals done (see Ben Silverman of NBC's "The Restaurant" on this one), or the long lead times some marketers need.
Did Burger King really get extended interest in that Western burger, the one that was created specifically out of an "Apprentice" episode? Maybe they got some Web site hits, but not much else. They are hard to eat; have it your way.
And how about those Pontiacs that Oprah gave away? We now know General Motors really didn't get much of a sales boost from that little promotion, but it did get millions of Web site hits. Oprah on the other hand is looking great these days, as ratings are up. General Motors? Oh, just a small setback -- it put its entire media account into review.
Branded entertainment won't save the day - it won't even save a minute or a 30-second spot. Few branded deals ever move the needle where marketers truly want to go - as a sustainable media tool that'll help take the sting out of high traditional network pricing.
And marketers think branded deals are overpriced. Why would they think that? Maybe it was Mark Burnett doubling the payment for a single episode entry into "The Apprentice" from $2.5 million to $5 million.
And, in that regard, let me get this right: marketers complain about networks getting single digit CPM increases? That looks like a pretty good deal next to Burnett's 50 percent price hike. And, by the way, aren't ratings for "The Apprentice" significantly lower than with the first two editions?
Take a good look at this branded entertainment math, and then do what the survey implies: Take your money - and run.