Viacom Plus Helped Soften the Blow

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One way Viacom Inc. tried to buck the ad downturn last year was by selling cross-media ad packages across its various properties through its Viacom Plus sales unit.

Viacom Plus did 13 deals last year, and struck gold with its $300 million package with Procter & Gamble Co. last May. That P&G bonanza involved 12 Viacom TV properties, including CBS, MTV: Music Television, MTV2, VH1, Nickelodeon/Nick at Nite, CMT: Country Music Television and TV Land. In total, MTV Networks was part of nine Viacom Plus deals in 2001.

"For us, we're looking for significantly more business than we'd get working in the traditional business model … from the individual divisions working themselves," Viacom Plus senior vice president Lisa McCarthy said. "It's challenging, to be frank, to find the situations where we're going to come up with something that's going to move the needle more than they would."

This March, Viacom Plus inked a multi-million dollar deal with the Snapple Beverage Group that included nearly all of the MTV networks.

Jack Myers, publisher of Jack Myers Report,
described Viacom Plus as making what he characterizes as "a commodity play," where Viacom packages ad inventory from various properties and sells it at a lower price to increase its market share.
But MTV's networks, with their attractive young audiences, have typically been able to command high CPMs, which might be dragged down by being packaged with other networks.

"It's very important that MTV keep it's own unique identity and brands in the market and its own marketing initiatives and not be bundled as part of a bigger corporate play, unless it's with like target audience demos," Myers said. "It's not an advantage for MTV to be part of Viacom Plus commodity sell, even though CBS would disagree with that."

The P&G deal worked for MTVN because it had "very little share of market so there was nothing but upside, especially given the softness of the kids market and the ability to generate increased revenue from a client they didn't have," according to Myers.

McCarthy claimed that it's "rare" for a Viacom Plus customer to get a discount on ad rates, despite that expectation.

"When we first got launched, we had to really fight that," McCarthy said. "I had clients coming to me and saying, 'I spend $30 million with Viacom, so if I spend it through you, can I get a better price?' And I said, 'I report to [Viacom president] Mel [Karmazin], so last time I checked, that's not why we created the division, if you know anything about Mel Karmazin.' "

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