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Wednesday, April 05, 2006

WSJ.com - Teasing Out the Effects of Clutter

WSJ.com - Teasing Out the Effects of Clutter
Teasing Out the Effects of Clutter
NBC Universal Is Studying
Whether Shorter Ad Breaks
Give TV Spots More Impact
By SUZANNE VRANICA
April 5, 2006; Page B3
The number of ads crammed into television shows has been a longstanding complaint of both viewers and advertisers. Now NBC Universal is testing whether cutting the "clutter" improves the value of the ads that do run.

In a five-night test that began Monday, one program airing on the company's USA cable channel will feature one commercial break that runs just one minute, considerably shorter than the others, which run about two to four minutes. Only two 30-second ads will air in the shorter break. Insurer Allstate and drugstore chain Walgreen are participating in the test.


NBC Universal, which is working with Publicis Groupe media-buying firm Starcom on the test, wants to see whether viewers pay more attention to ads they watch in a less-cluttered environment. "We want to see if shorter commercial pods impact advertising performance," says Sam Armando, director of TV research at Starcom, which cooked up the deal.

"We are all trying to better understand commercial effectiveness," says Marianne Gambelli, executive vice president of sales and marketing for General Electric's NBC Universal, which owns the NBC broadcast network as well as USA and several other cable channels.

The outcome of the test could lead to changes in the decades-old advertising model. If the test shows that viewers remember the remaining ads more clearly, it could give advertisers the ammunition they need to ask TV networks to cut back the number of ads they air.

Networks likely would recoup the lost revenue by charging higher prices. A reduction in the number of ads would reverse the trend of the past decade, a period in which broadcast networks and cable channels alike have squeezed more ads into each hour of TV programming.

Ms. Gambelli played down the test's short-term significance, noting USA has "no intention to change any [business] model. All this is for later discussion."

Still, changes in the media landscape are increasing pressure on TV networks. Devices such as digital video recorders are making it easier for people to speed through ad breaks.

Media buyers and marketers have long complained that the crowded TV ad environment diminishes the impact of all the commercials. "Clutter affects all our messages," says Eric Plaskonos, director of brand communications for Philips Electronics. Many believe that the more ads that run, the more willing consumers are to change the channel or speed through commercials on a DVR.

Last year, Walt Disney's ABC, NBC, CBS and News Corp.'s Fox each ran an average of about 15 minutes an hour in prime time of "nonprogram material time," defined as commercials, public-service announcements and network promotions, according to research complied by WPP Group's media-buying unit MindShare. USA cable channel, like some other cable channels, aired nearly 16 minutes of "nonprogram" material an hour.

Other media have begun to respond to complaints about ad clutter. In 2004, radio titan Clear Channel Communications reduced the number of ads on its radio stations in hopes of increasing the value and impact of the spots that air.

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