Monday, 19 January 2015

Channel 5 only makes about 2/3 of it's income from spot advertising'

"One of the interesting things about Channel 5's business model is the way it has decreased its reliance on traditional revenue streams - spot, sponsorship and digital - in favour of new ones: AFP, co-production, product placement, barter, live events such as the Gadget Show Live and so on.
Back in 2010, I'm told, about 90% of Channel 5's revenues came from spot; today it is about two thirds.
The current series of CBB is a good example. There's a twist on the Gumtree sponsorship where, pre-show, users could sell stuff to the BB house and, after the show, the contents of the house will be auctioned off. But watch the series carefully and you'll also see some artful product placement: brands like Weetabix, Volvic, and L'Oreal.
This non-spot revenue strategy gives Channel 5 some protection from the brutal world of share deals. As the smallest player it is always going to get bullied on share, but since non-traditional revenues are excluded, it can find a way to ease the problem. And it goes down well with agencies too."

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