It’s the Rugby World Cup Final Saturday Night and the UK’s ITV Network Stands To Make An Advertising Killing As England Face South Africa in Paris, and Then the Next Day Another Huge Sports Bonanza For The Network As A Brit Stands To Win The Formula One Championship

And it all goes to show that with a little luck and a lot of guts, European terrestrial networks can compete financially with the satellite companies that are supposed be the only ones with pockets deep enough to pay for sports rights. And if a terrestrial network hits pay dirt, then it can really be big pay dirt. To do it twice in one weekend is extraordinary.

Consider this, Saturday nights do not normally command high TV advertising rates. The young affluent males are out dining and dancing their feet off. But rugby changes all of that. Advertising executives believe that for last week’s semi-final ITV made six to seven times more than it would normally do on a Saturday night knowing not only did it have a large audience but it was the very audience the advertisers crave. And with England actually in the finals then this Saturday alone could produce some £11 million ($22 million, €15.5 million) in advertising revenue. Those numbers are probably far higher than called for in the company’s business plan since most sports analysts predicted when the competition began that England would be out of the competition by the quarter-final stage.

ITV paid £40 million ($80 million, €56 million) for the rights to the 48-game tournament, showing all games on its primary terrestrial network channel or one of its digital channels. It signed up a few months back French company sponsors Peugeot and EDF (Energie de France, electricity supplier) for £4 million ($8 million, €5.6 million) which included the special web site the network set up (which is an example why the International Rugby Board tried to restrict third party Internet usage – see stories in the follow-up box), but a lot of other advertisers held back wanting to see how England did.

Turns out that is now an advantage to ITV that can sell spots in the final at around double what they would have been if England was not playing.

ftm background

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The ball was deep in International Rugby Board (IRB) territory. The opponents, the world’s news media led by the international news agencies, were in hot pursuit. Finally the referees, France, the EU, and sponsors, called for a scrimmage – a banging of heads. Suddenly the IRB’s forward line collapsed, out came the offer which the media ran with for the winning try. Or put the American way, the bad guys blinked first.

Australian Football League Still Refuses To Accredit International News Agency Photographers, The NCAA Bounces A Play-By-Play Blogger From The Press Box, And The Screws Are Still Tight On Rugby Cup Coverage -- The Collective Media Had Better Not Take Its Eye Off This Ball!
The digital age has blinded sports rights holders with $£€ signs and they are determined to make big money from what once was the media’s province. And yet the media seems pretty lame in fighting back, and it’s about time it, too, started playing hardball.

When Les Hinton Gets It Wrong – Sales of The Sun dropped in June Instead of Getting A World Cup Bump – Then You Know That Newspaper Reading Habits Have Forever Changed And Newspapers Had Better Change Their Ways

Les Hinton, executive chairman of News International, UK, told a standing-room only audience of global newspaper publishers in early June that with the World Cup starting soon that he expected to see up to a 12% bump in daily sales of the Sun tabloid, Britain’s largest circulation daily newspaper. What he ended up getting was selling 82,000 fewer copies in June than he did in June a year ago – a drop of 2.54% with average June sales of 3,148,700, down 329 from May.

The World Cup Brings Advertising Riches To Some, But Not To All
China wasn’t even in the World Cup, and the tournament was held mostly in Chinese morning hours, but its web sites cleaned up big-time with huge advertising profits. For some European countries, the television advertising revenues could benefit by as much as 4%, but in others, including the UK, the World Cup has had a negligible effect on television advertising. And the ratings in the US for some of the games matched major domestic sporting events.

Its World Cup Fever Time, Especially For The TV Licensing Folk Who Say Watch It On Broadband At Work and The Employer Better Have A TV License Or Else!
TV viewing numbers for this year’s World Cup Football are as much as double the last tournament four years ago, and this time around mobile and broadband coverage is expected to increase viewership a whole lot more, but in those countries where a TV license is mandatory the authorities say they are serious about fining employers who let staff watch the games via broadband on their office PC if there is no TV license.

If the ITV executives weren’t already breaking out the champagne and cigars over that, they have another big sports bonanza on which they will make a killing on the Sunday on an event happening half a world away in Sao Paolo. British Formula One driver Lewis Hamilton is racing for the year’s championship, and ITV has those rights, too.

Advertising agency specialists believe the network will generate some £5 million ($10 million, €7 million) from that race alone. ITV is thought to be paying an annual rights fee of around £20 million, so getting that much back on the final race will be welcome, unexpected revenue.

Like the Super Bowl in the US, the Rugby World Cup has had a spectacular effect on all things that surround the tournament, not the least of which is the huge uptake in buying flat screen TVs. In the UK, two main electronics stores said before the tournament began they were selling the TVs at a rate of about one every 15 seconds. In France, the Gfk market research firm said 720,000 televisions were sold in August and September, some 84% more than the same period last year.

Television likes sports. Fans don’t want to tape games and watch them later when the results are already known. They sit in huge numbers watching the live broadcast, watching the ads, too. That’s why the Super Bowl, for instance, commands the highest priced ads on TV. Advertisers, therefore, like sports for the audience it delivers, but sporting bodies cannot take for granted that the huge amounts companies pay for sponsorship will necessarily continue if more cost effective ways are found to bring in large numbers of consumers.

For this week came the stunning news that Kodak is joining General Motors in pulling out as official US Olympic Game sponsors after the Beijing Olympics next year. Kodak has been one of 12 top-tier sponsors of the event for some 20 years, linking its logo and advertising with Olympics marketing.

Both companies are undergoing financial upheavals, but both claim it’s not the money (GM says it spends around $100 million on Olympic marketing activities in the years the Games are held, ) but rather they are looking for better cost effective ways of getting their message across.

The belief has always been that the Olympics are about the biggest exposure a multi-national company can have which is why it attracts sponsors like Coca-Cola and McDonalds. But in GM’s case, a spokesman says “The Olympics are almost too big for one brand to absorb” (GM pushes its Chevrolet brand in its US Olympic team sponsorship).

“We have other avenues to be able to reach this same audience without bearing the expense of being an official sponsor of the U.S. Olympic team," said GM spokeswoman Ryndee Carney. At Kodak, Elizabeth Noonan, Director of Brand Management , said “Our new business strategy requires us to reassess our marketing tactics as well, and adapt them to changing market conditions and evolving customer behavior."

Kodak says it intends to take the millions of dollars it will save from no longer sponsoring the Olympics and use it for such marketing as investing in "Kodak Gallery Scan Vans," that drive to shopping centers and the like to help customers digitize old photos, plus it is sponsoring "Inspiration Tours," that showcase its printing and scanning products at state fairs and similar venues.

There is a strong message there – that such corporate heavyweights are looking at how they spend their marketing funds and nothing, not even the Olympic Games, are sacred any more.

But back to rugby, our US readers may well wonder what all the fuss is about since the final this Saturday, unless there are last minute changes, will only be available in the US on the Internet or satellite (and yes, they play rugby in the US but the US team was knocked out of the tournament in the early stages). Hoping to pick up the slack, at least in the nation’s capital, the New Zealand embassy, (their All Blacks were the favorites to win this year) had invited loads of people to the embassy to watch the semi-final and the finals in the sure knowledge that the All Blacks would be winning. Turns out, no All Blacks, no embassy screenings.

Lorraine Schofield, the embassy's congressional relations officer, emailed the invitees, "Due to New Zealand's heartbreaking loss to France in the Rugby World Cup, the embassy is in mourning and must regrettably cancel its planned October 13 and October 20 rugby screenings. During this sad and difficult time, we ask that you respect the embassy's grieving process. We have been reliably informed that life after rugby does go on, but we are not yet ready to believe that proposition." The Kiwis take their rugby very seriously!

Britain’s Prime Minister Gordon Brown and South African President Thabo Mbeki will be watching the final in Paris on Saturday (that’s just too much positive TV exposure for politicians to pass up) but the South Africans failed in their efforts to lure their secret weapon, Nelson Mandela who, at 89, said the trip would be too long and tiring on such short notice.

Rugby Final Biggest UK Program Of The Year - October 22, 2007
It was a rotten weekend for British sports – South Africa beating England 15-6 in the rugby final and Lewis Hamilton failing in his quest for the Formula 1 driver championship -- but for commercial broadcaster ITV it was about as good as it is ever going to get....MORE