For both Adlink and the New York Interconnect, to borrow
from a classic Frank Sinatra tune, 'It was a very good year' in 1997.
Adlink, the Los Angeles interconnect, saw its ad revenues
soar 54 percent to $61.4 million last year, with president and CEO Charlie Thurston
crediting that upsurge to a heavy emphasis on value-added elements.
Besides being way over budget, that total 'was, I
believe, the highest [sales] achieved in '97' by any interconnect, he estimated.
While its marketing orientation seemed to be the main
driver, Adlink also attracted new business and increased spending by existing clients with
its research and back-office capabilities and the growing acceptance of its Adtag and
Adcopy features, Thurston said.
In New York, Eglon Simons, vice president and general
manager of the New York Interconnect, said his operation finished 1997 'a tad under
40 percent' in sales growth, and that the fourth quarter alone grew by 60 percent.
The interconnect actually exceeded its 1997 budget before the final quarter began, he
said, thanks in part to having doubled its sales in October alone.
'We stay away' from divulging ad-revenue figures,
he said, although he estimated that his interconnect, covering the largest DMA, ranked
second to Adlink in ad volume among interconnects. Still, he maintained, 'it's
like [comparing] apples and peaches.' Although the New York Interconnect reaches the
most subscribers among interconnects -- 4.5 million -- Simons said his operation's
sales are based on 15 percent dedicated inventory across 10 networks, well below
In Los Angeles, non-Adlink cable sources pointed out that
the addition of an estimated 300,000 Century Communications Corp. subscribers in mid-1996
also contributed to the hefty year-to-year percentage growth.Thurston did not
indicate how much of the growth was due to the addition of Century to its mix.
Another cable-sales executive not affiliated with Adlink
said the interconnect may have a marketing emphasis that's stronger than most, but
several other major-market interconnects also have staffers targeting the promotion tie-in
In New York, Simons agreed that a marketing emphasis has
become increasingly important in interconnect selling.
'Adlink is a good model [in that regard]. Advertisers
just don't just want spots anymore: They want added value,' he said.
His interconnect does not currently have a dedicated
marketing staff, but Simons promised that 'we will set that department up' later
Adlink, which enjoyed the first full year of implementing
its $10 million digital upgrade via Digital Equipment Corp. in 1996, has topped $30
million in national and regional spot ad revenues every year since 1995. Thurston said
Adlink's new high in spot sales translated into $24 per subscriber.
Adlink's record 1997 figure was posted 'by using
one-third of local [system] inventory' -- or, more precisely, 35 percent -- across 24
networks and 70 headends, said Hank Oster, its senior vice president of sales and
marketing. That model 'has worked extremely well' for the interconnect and its
participating systems in the second-largest DMA, he said.
Having increased its insertable networks by four last year,
Adlink has no plans to add more to that package this year, Oster said.
Adlink reaches 3 million Southern California households,
according to Nielsen Media Research.
Selling the DMA became much more simplified in mid-1996,
once Century became the 11th equity partner and the last major MSO holdout to join the
interconnect. By offering virtually marketwide coverage (95 percent), the interconnect has
now 'erased any [agency buyers'] concerns about fragmentation' in the
market, he said. Century may represent only 9 percent of the interconnect's
subscriber base, but that 9 percent includes some important, upscale neighborhoods, he
Thurston detailed other contributors to Adlink's
Its client-services group -- featuring three account
executives, based in Los Angeles, New York and Chicago -- generated $9.4 million for
Adlink last year, Thurston said. That group concentrates on pitching spot cable in general
and Adlink in particular to senior executives at key advertisers and agencies. In Los
Angeles, Subaru upped its Adlink spending from zero in 1995 to $2.4 million in 1997 due to
the group's efforts.
In New York, its client-services account executive broke
the Kraft Foods business last year, with a $600,000 buy for 'a seven- or
eight-product rotation.' Later this year, Adlink will promote this department with a
separate direct mailing.
National Cable Communications, Adlink's New
York-based rep firm, helped to generate $18 million for the interconnect as 'an
extension of its national sales force.'
As far as research, Jane Piedad, research director,
develops custom research pieces to bolster Adlink's selling effort. For example, one
piece last year supported the packaging of cable news networks (Cable News Network, CNN
Headline News, MSNBC, CNBC and Orange County Newschannel). That piece helped to lure some
clients away from local TV newscasts, Thurston said.
Adlink also incorporates Polk Automotive's research --
which tracks automobile sales by county, model and the like -- into its selling materials,
Adtag -- which enables Adlink to insert dealer or
franchise tags on commercials running in different areas of Los Angeles -- generated $1.9
million last year, Thurston estimated, noting that Mercedes-Benz dealerships alone
accounted for $343,000. And Adcopy -- whereby Adlink clients simultaneously run different
spots in different parts of the market -- delivered $1.7 million last year, he added. For
example, Southern California Chevrolet dealerships spent $467,000 on Adlink, rotating car
and truck spots by different systems and demographics, he said, while Anheuser-Busch Cos.
split its buy between Budweiser and Bud Light.
Hiring Vicki Lins as its marketing director in late
1996 has enabled Adlink to bolster its marketing campaigns toward the ad community and
also to offer truly integrated approaches, Thurston said.
About 25 percent of Adlink's clientele have now used
some form of promotional or marketing involvement through the interconnect, rather than a
pure media buy, Lins said. These efforts ranged from cobranding tie-ins with cable
networks or advertisers, to program sponsorships, to multimedia packages.
In the fourth quarter, Adlink brought together Volvo of
North America, Pillsbury Co., Ralph's Supermarkets and A&E Network's Biography
in a promotion backed by $850,000 across two weeks, Lins said. Ralph's, besides
supporting the tie-in and its shopping-club card with mailings to 3.5 million homes,
displayed Volvos inside its stores next to signs saying, 'Join the Ralph's Club
and you're entered to win' -- and Volvo even sold two cars through Ralph's,
she noted. In another A&E link, Dreyer's Grand Ice Cream promoted its Portofino
premium brand with a 'Journey to Portofino' sweepstakes, in conjunction with
A&E and Hughes Supermarkets.
All told, Adlink developed 'six times more custom
promotions' for clients last year than in 1996, Lins said. Still other cable-network
linkups involved VH1, E! Entertainment Television and Food Network. Miller Brewing Co.,
pitched by Adlink for seven years, finally came in last year, tied into VH1's
'Route 97' promotion, she said, while Hyundai Corp. signed on to reach the same
young-adult demo as E! and Macy's.
In addition, links to Food's celebrity chefs lured
Kraft and Pillsbury, while ESPN's X Games brought in a $250,000 package from
Arco's AM/PM Minimarts and PepsiCo Inc.'s Mountain Dew.
By category, it wasn't unusual that automotive was
again Adlink's topper last year, but it was surprising that it was also 'our No.
1 breakthrough category,' Oster said. He explained that Adlink landed six major
automakers 'at the national-factory level,' rather than at the dealership level,
where the interconnect's primary success has always been. The six, he said, are Mazda
Motor Corp., Toyota Motor Corp.'s Lexus division, Mercedes-Benz of North America,
General Motors Corp.'s Cadillac division, Hyundai and Volvo.
Two other 'breakthroughs' last year, Oster said,
were foods (Kraft and Pillsbury) and fast food (McDonald's Corp., Taco Bell, Subway,
Carl's Jr. and El Pollo Loco).
In 1998, he said, Adlink will press for additional inroads
in foods, packaged goods, fast foods and factory-level automotive.
The New York Interconnect also overcame some
companies' resistance last year -- notably McDonald's, Coca-Cola Co. and
Tiffany's -- said Simons, who now hopes to add to the list of first-time interconnect
users from the fast-food sector and from other consumer-products sectors. The strongest
growth categories in 1997, he added, included banks, telecommunications, entertainment,
tourism and business products.
Automotive, always strong, showed more diversity last year,
he said -- 'not just the big guys' -- at both the dealership and factory levels.