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Nine who move the market



The pace for the upfront is set by a select group of advertisers who have the most clout in their categories. Here are nine of the biggest spenders and the st

What does it take to be one of the key players in the network television market this time of year? A big name and even bigger money are the first requirements. When the media buying commences for next fall’s network offerings, it’s the companies-with clout a time-tested brand name and/or exceedingly deep pockets that always seem to get the best price. But there’s also the human element, an often underrated factor. The right person is crucial when it comes time to broker a deal. Sawy buyers can make the difference between losing or saving vast sums. They can even be the deciding factor in the success or failure of products as diverse as cars, colas or films. The following profiles examine some of the industry’s top dealmakers.
TONY PONTURO
Anheuser-Busch
To Tony Ponturo, primetime and the upfront buying season are not the awe-inspiring monoliths they once were. “We now look at a medium called ‘national TV,'” says Ponturo, vp/corporate media and sports marketing for Anheuser-Busch. “It’s not just NBC, ABC, CBS and Fox, but also good national syndication and the cable entity.
“The past two years have not been a traditional upfront,” adds the 41-year-old Ponturo, who also is president of A-B’s Busch Media Group USA buying unit. “We have got to be more selective, and we’ve almost created another market for ourselves that is multiquarter and involves a lot of guarantees, but is not part of the traditional media upfront.”
Aside from the highly tuned demographic issues that can make network TV upfront problematic for beer makers, Ponturo notes a couple of other dynamics at work. Given the soft economy, advertisers feel less “panic” about committing to broadcast inventories before they’re absorbed. That flexibility can be an important asset to companies like A-B, which are on a calendar-year budgeting cycle.
In July, Ponturo says, “a lot of advertisers still are trying te see whether their plans for this year are working rather than projecting what will work in 1994. So we may not have the luxury to move money in the environment of an upfront, and we haven’t done so in the last two years. We can find opportunities in September/October or even in scatter that are multiquarter deals outside the normal upfront, at CPMs that are still acceptable.”
One area where beer advertisers and networks must resolve often-conflicting interests pertains to the attractiveness of specific programs versus the networks’ attempts to win broad commitments from advertisers. For a category like beer, which tries to reach a highly targeted consumer segment, the problem is more complex.
“With our targeted consumers, we have to do more than say ‘Buy bulk programming at a good CPM and meet the GRP requirements with this particular flight,'” Ponturo says. “So we might find ourselves doing two shows on one network and one show on another, rather than pitting two or three networks against each other and only buying one or two of them.”
As for the specific lineups for this fall, Ponturo says he’d hoped for better from the schedule. “We were somewhat disappointed that most of the new programs are geared more toward women 25-34–ironically, at a time that the beer industry actually is looking to balance the sports-versus-primetime mix more toward the primetime side.”
Also disappointing, he says, is a reshuffling of the Fox lineup on Sunday night that saw the departure of In Living Colon Herman’s Head and Flying Blind. “It makes sense for Fox Network, but for the beer advertiser trying to reach the young male they totally took away that Sunday night block. Our consumer is active. Sunday is their crash night.”– Gerry Khermouch
DAVID GREEN
McDonald’s
Figuring out the broadcast mission of David Green, senior vice president of marketing for McDonald’s, is easy. Just look at Big Mac’s recent deals and follow the bouncing ball, which goes from the National Basketball Association to the Olympics to the National Football League and hack to the NBA again.
Green and his agencies, Leo Burnett and DDB Needham, like the big events of American pop culture. And they use these affairs to deliver McDonald’s target audience–kids big and small. They call it “presence marketing” in Green’s department, and straight-up media buys alone don’t cut it.
McDonald’s spent some $218 million on network media in 1993, according to LNA/Arbitron, and much of that went to the big properties, both as official and broadcast sponsor. Big Mac’s partnership with Coca-Cola on a massive NFL sponsorship is one example. The deal has McDonald’s committed to upwards of $75 million in national football media buys across the next five years in exchange for promotional opportunities with the league’s vast resources.
Green and company are also coming off their biggest NBA program yet, which leveraged McDonald’s heavy network buys and “Nothing But Net” advertising hit into a multilayered “NBA Fantasy” retail promotion. That commitment could get even bigger next year, says one network source, who adds that basketball fanatic Green already is huddling with the NBA about ways to extend McDonald’s hoop franchise. One obvious property on the horizon is the McDonald’s Open, an NBA-administered international club tournament, that Big Mac and NBA execs are hoping to expand into an annual world club championship by the end of the decade. “They want to leave no doubt that, in their category, they own the sport,” the source said.– Matthew Grimm
CHUCK FRUIT
Coca-Cola
Chuck Fruit is pretty high on the fall TV schedules, and that could be good news for the networks. Fruit, you see, is vice president/director of global advertising and media for Coca-Cola, which means he heads the cola giant’s upfront buying effort.
“The new programming tends to be pretty conservative in format and general style,” says Fruit, whose company spent $55.8 million to advertise Coca-Cola Classic on network TV last year and another $39 million on Diet Coke, according to LNA/Arbitron. “The networks are relying upon some traditional, proven formulas and recognized talent that have proven appeal to television audiences.”
Such talk of tradition and formula might seem jarring from one of the masterminds behind the controversial “Always Coca-Cola” campaign which, despite the tagline, is anything but traditional. But Fruit says the tenor of some of the shows should match well with the youth orientation and style and sophistication of the spots, most of which were executed by Creative Artists Agency.
“We’re predisposed to look for situation comedies and comedy programming with appeal to the 12-24-year-old audience,” Fruit says. “We’re aiming in the direction of a little more sophisticated and witty humor, and less in a slapstick, raucous vein. Several fit that description that we’ll look at carefully.”
Among those shows are Saved by the Bell, Fresh Prince, and perhaps Sinbad on the Fox Network. The new Dave’s World might work, too, although it’s not skewed as young as Coke prefers.
While some advertisers cite the economy and the mix of available shows as deterrents to making any sweeping upfront commitments, Fruit sees no reason for Coca-Cola to break the pattern of recent years. “In the past, we’ve been active in both (upfront and scatter) but we’ve generally made major upfront purchases in primetime. We’re predisposed to go that route with established shows at reasonable prices. The networks’ pricing will determine whether that predisposition will turn into a disposition.”
Fruit says he anticipates no dramatic changes in Coke’s overall mix of broadcast versus print, or national versus local. Rather, he expects more of the evolution that the industry as a whole has seen. “We monitor our consumers’ media habits very closely, and they’re spreading their viewing among a broader array of options,” he says.– Gerry Khermouch,
JIM VAN CLEAVE
Procter & Gamble
When Jim Van Cleave comes to the network television bargaining table, those on the other side know what to expect. He will be all business, he will be firm but fair, and he will spend heavily on behalf of his company, Procter & Gamble.
“He is a guy who gets right to the essence of an issue,” says Mike Moore, executive vp/worldwide media director for D’Arcy Masius Benton & Bowles/New York. “He usually defines the issues exactly right. He’s extremely fair, but also knows what he wants and knows how to get it.”
Adds Marvin Goldsmith, president of sales and marketing at ABC TV, “When Jim and his people are handling the negotations, they are forceful, truthful and tough negotiators. You know where you stand when you cut a deal. And to his credit, he lives up to the deals completely. He’s a terrific individual. Very honest, very forthright.”
Industry observers expect the world’s biggest advertiser to increase network ad spending this year, which means that Van Cleave, vp/media and programming and a 15-year veteran of P&G, will be even more busy than usual.
“Diapers and detergents will be hot categories for P&G,” says Bonita Austin, a household products and cosmetics analyst for Lehman Brothers. “Unilever said they’ll spend $100 million in advertising for their double-power detergents. And liquid detergents is only a $1.8-billion category. So I don’t think P&G will just sit back.”
Bill Wyman, a partner in the Silvermine Consulting Group in Westport, Conn., expects paper products and coffee to also get the P&G push. “They have folded White Cloud into Charmin Ultra, so they will combine the media expenditures and make a major impact on one brand,” he says. “And coffee is still very big for them. The Folgers concept has the opportunity to grow as a leading brand. Increased advertising could help it in the aisle and in the segment as P&G tries to further its lead over Maxwell House.”– Judith S. Riddle
PHIL GUARASCIO
General Motors
Phil Guarascio, the aggressive and outspoken general manager of advertising and marketing for General Motors, may be the best-known media buyer in the car industry. He’s certainly got the deepest pockets. Last year, Guarascio oversaw $449.5 million in network television spending, according to LNA/Arbitron. With its six car and truck divisions, extensive corporate campaigns and new credit card programs, GM accounted for more than one-third of the $1.4 billion spent on automotive advertising on the networks last year.
A one-time adman, Guarascio has often been considered an outsider in Detroit. He’s pushed the slow-moving company to consider new ideas. In the mid-‘SOs, he helped GM consolidate its media buying by forming the GM Media Council, which now oversees about $1 billion in total spending. That clout has given GM the much-needed weight to administer clutter-busting programs over the years.
For next year, Guarascio has crafted a synergistic sponsorship for the 1994 World Cup Soccer series, which will give GM global exposure. The exclusive deal will put the U.S. divisions, GMC Trucks and Pontiac on the network television map for most of the 1994 summer. Although soccer is still unproven as a TV sport in the U.S., the fact that the ’94 Cup will be hosted by the U.S. gives it the best chance for a breakthrough.
Last year, Guarascio put together a GM-sponsored program called The Ultimate Driving Challenge. The program, which tested viewers’ driving knowledge, featured only GM products and used the theme “Come See the Changes We’ve Made.” Guarascio announced the program to a group of automotive heavy hitters at a J.D. Power conference on car advertising in February, saying he wanted “high-visibility, category-breaking advertising.”
After the success of that show, Guarascio hinted he’d like to do more such programs, rather than rely on standard buys of popular television fare. Guarascio contends that Ultimate-style ventures can offer a more involved relationship with the consumer than traditional media can deliver. Look for more such deals next year.
As a negotiator, Guarascio gets high marks, but network sales reps note that he has a lot of people to answer to. Says one rep, “Guarascio is a capable guy, but he has to deal with all the GM divisions who don’t want some New York guy telling them what to do.”– Fara Warner
JOHN COSTELLO
Sears
Change is in the air at Sears Merchandise Group, where John Costello, the new senior executive vp/marketing, commands the nation’s second-largest brand advertising budget.
“I would say one of our key priorities is to deepen our understanding of our target audience,” says Costello, a former Procter & Gamble brand manager who joined Sears in April. “And our target audience is really middle-class families.”
Costello has never run a retail account, but that doesn’t mean he’s not familiar with the business. Before joining Sears, he was president of Nielsen Marketing Research, a firm that compiles and interprets scanner data taken in supermarkets, drugstores and megachains such as Wal-Mart.
Sears, which is in the middle of a management realignment, is also conducting a review for its $40-million-plus apparel advertising business. Incumbent Ogilvy & Mather/Chicago is out of the running, and the race is down to Young & Rubicam/N.Y., Hal Riney & Partners/S.F. and Wells Rich Greene BDDP, where Costello worked as an executive vice president in the early 1980s.
New apparel advertising, which will break in the late summer and run heavy through the fall, promises to make a big splash on primetime network schedules, although Costello says he is looking at cable schedules, too. “What I think you will see from Sears in the future is an increasing amount of work on television and radio,” he says. In 1992, Sears spent $409 million on advertising, according to Leading National Advertisers, apportioning $194 million to network ads alone.
Costello intends to better target women, the gatekeeper of family purchases. He also plans to increase advertising penetration to minorities. “The days of the mass target are over,” he says. But not, he hopes, the days of the mass retailer.– Elaine Underwood
BOB WATSON
AT&T
In the nine years since Bob Watson was hired as AT&T’s corporate media director, he has acted as the linchpin in a massive and often chaotic effort to transform the onetime monopoly into the leader of a hotly competitive market.
Today, as director of advertising services for AT&T, he oversees media and production services for the company’s residential and business operating groups and coordinates its national TV negotiating and planning strategy.
“With a customer base of 80 million, network TV is a vital and viable element in how we tell our story,” Watson says. “We know it and the networks know it. Long distance is a business where a one-point share loss means hundreds of millions of dollars, and the networks will absolutely leverage that the best they can.”
AT&T spent about $170 million in the 1992 network marketplace-roughly half of the telecommunications industry’s network expenditures–and maintained its 63% share of the $52-billion domestic long-distance market, and Watson says it has no plans to ease up this year.
Although he’s quick to credit the networks for gains in providing more flexible, fuller-cycle marketing opportunities for advertisers, Watson plans to press them even farther this year. He says he’s looking for new creative partnerships with networks that will build AT&T into sponsorships, individual program exclusivities and co-productions as Ma Bell continues its dominant share of voice positioning whatever marketing plans turn out to be.
Amid the tidal changes in the TV landscape, networks are willing to restructure buying plans as the need arises, Watson says, because they have seen “all the warning signs, and heeded those warnings. So, like us, instead of arrogant, they’re becoming more helpful.”– John McManus
BOB LEVIN, BOBBY BLAIR
Walt Disney Studios
With four studios under its roof and nearly 60 films scheduled to open next year–the average major studio is expected to release 20–Walt Disney Studios is easily Hollywood’s biggest player in the upfront television market. It’s also the quietest.
Neither Bob Levin, Disney’s president of worldwide marketing, nor Bobby Blair, the studio’s senior vp/media, will discuss the company’s media buying habits. But the sheer bulk of the advertising–it’s the largest Hollywood studio buyer of both network and cable time–and the company’s manner in the marketplace has the rest of the business talking.
“They pay a lot of attention, most of it deeply researched, to what kind of programs they buy and what kind of commercials they put into what programs,” says one network executive. “They are intuitive and detail-oriented and they combine that with hard-nosed negotiations.”
Adds another exec, “They know what they want and they’ll come in and negotiate hard to get it.”
LNA/Arbitron calculates that Disney spent $34 million on network TV during the first quarter, up from $20 million in 1992’s first quarter. That figure is likely to jump with big releases due from the Disney, Touchstone, Hollywood and Miramax studios and a theme park battle brewing with Time Warner.
Like other studios, Disney’s buys are driven by the day of the week, with Wednesdays and Thursdays the most important because that’s when consumers begin making weekend plans.
Disney and its media buying agency Western International look for wholesome environments with younger demos, especially for commercials that air for Disney movies. Standards are less stringent for movies under the Touchstone and Hollywood labels.– Lisa Marie Petersen
DAVID BRAUN
Kraft General Foods
Cheaper Marlboros means fewer cheese ads. At least that’s the conventional wisdom around the Glenview, Ill., headquarters of Kraft General Foods. Once parent company Philip Morris announced its price-slashing of cigarettes, the other divisions realized that corporate belt-tightening would be needed to protect profits during the coming year.
It will be up to David Braun, director of media services for KGF, to play the weakened hand he’s been dealt. Some agency executives expect Kraft ad budgets to be trimmed 5-10%, or perhaps more. This will also be KGF’s first upfront season since its marketing services unit was formed under Lorraine Scarpa last September. The framework is likely to mean more give-and-take between brands.
The dollar shifts actually began last year, with network spending up for some cheeses and down for Good Seasons and Kraft Free salad dressings from ’91 levels. At the same time, KGF increased spot spending for some key brands. For instance, ’92 spot buys for Singles cheese slices were three times the ’91 network buys, according to LNA/Arbitron.
Braun has been vp of media services since Kraft and General Foods buying was combined in November 1989; he had been director of media and promotion services at General Foods. With nearly 20 years experience in media, he has a reputation as a savvy dealer. More content-sensitive than many advertisers, KGF pulled out of Donahue last year because of the show’s controversial material. It’s also likely to continue producing a handful of movies, such as this year’s sponsorship of the highly rated Call of the Wild.— Betsy Spethmann
Copyright Adweek L.P. (1993)