How to Make a 24-Hour Advertising Channel Work

Cable World, Oct 14, 2002

Byline: ANDREA FIGLER

A five-minute commercial about an oyster bar? How about 300 seconds of airtime devoted solely to pitching a private resort community?

If you think these sound bad then just imagine this kind of ad running one after the other - without programming in between - all day long.

Downright unbearable.

So the thought of a 24-hour cable channel devoted strictly to advertising made me wince. That is, until I watched a few entertaining and informative commercials and spoke with nine cable ad executives, who helped explain how an advertising channel can draw eyeballs and turn a handsome profit despite its lack of programming and subsequent ratings. In fact, at least two of these local advertising channels are capturing the attention of national advertisers.

But a few basic tenets apply.

Tenet No. 1: The channel must produce good-quality long-form ads with an interesting twist such as mocking an existing cable program or using a host or personality from the local community.

Take the oyster bar ad.

The oyster bar, Awful Arthur's, and Charter Communications' advertising arm in Kill Devil Hills, N.C., successfully pulled off a five-minute mock VH1 Behind the Music commercial called "Behind the Oyster." Airing on the system's ad channel Outer Banks TV-12, the commercial begins retracing the restaurant's history, using a mix of faux tragedy about the owners and, yes, the oysters, too. The sheer silliness kept my eyes glued to the screen. I mean, mock oysters with googly eyes chanting "Aw-ful Ar-thur's" as if they were the Budweiser frogs - how could you not love it?

On a more serious note, other businesses need the longer format to actually inform viewers about their product or history, such as private resort community the Currituck Club within the Outer Banks. J.P. Morgan was one of the wealthy financiers that purchased the acreage in the mid-1800s to help preserve their favorite hunting grounds for waterfowl. Interesting tidbit of information even if you don't hunt, no?

Tenet No. 2: An ad channel should target the local community - with a passion.

Outer Banks TV-12, for instance, runs within a resort community where people are looking for fun things to do and good things to eat. In order to win this particular audience, local businesses have been shelling out extra cash to make two- to eight-minute ads. For 15 years, the channel has been turning a profit, says Gene Williams, the advertising general sales manager.

Tenet No. 3: Cross-promotion is key.

Any 24-hour advertising channel must be teased on the other insertable networks, executives say. CCIN, an advertising channel for Charter Communications in St. Louis, takes 30 seconds of the longer infomercials and inserts them on cable networks such as MTV and CNN Headline News. Within those 30-second ads, the viewer is directed to turn to CCIN to find out more about the particular business. This cross-promotion has helped CCIN become the second-most-profitable network of the system's 39 insertable networks, says Frank Babcock, national sales manager for Charter Advertising St. Louis. Even national advertisers such as Subaru are signing up these days, he adds. The system has even started to add local sports programming, helping generate lots of local interest and, perhaps, Nielsen ratings in the coming years, he says.

Tenet No. 4: Ads must produce a good profit margin - one large enough to make account executives want to sell the ads yet slim enough to be affordable to local businesses.

This is, by far, one of the most crucial balancing acts a cable system can perform. Long-form videos carry a much higher price tag than still-photo-frame classified ads, the traditional type of commercial on a cable ad channel, says John Lichius, local sales manager for the FYI channel that runs on three cable systems in the Pittsburgh area. Even though long-form video costs more to make, it generates a higher profit margin because it lasts longer, he says. FYI reaches more than 600,000 homes and provides its cable operators more revenue than a shopping channel does, Lichius says.

So if a system can follow these basic tenets, it may very well have a successful advertising channel on its hands - one that is profitable and, well, actually interesting to watch.

After all, who would've thought oysters could be so entertaining?