ITV ad sales in May are predicted to fall back eight per cent in May after an increase in April, meaning that it’s time for ITV’s new management of CEO Adam Crozier and commercial boss Fru Hazlitt to roll their sleeves up and start performing.
New sales director Kelly Williams from Channel 5 won’t be able to help much as he’s still serving out his gardening leave from Richard Desmond’s station.
ITV enjoyed a boom in 2010 on the back of the general recovery in the UK ad market, seeing turnover back through £2bn and profits hit £286m.
But Crozier, new chairman Archie Norman and Hazlitt saw fit to dispense with the services of sales director Gary Digby and his team, the people who brought in all that lovely loot.
This played very badly indeed with the UK media buying fraternity who, all of a sudden, found they were quite fond of Digby and co, tough negotiators all.
The boys (and girls) in the back room were mystified by all the talk about ITV focusing on its digital offer (which currently account for just 1.4 per cent of revenues) and proposed pay walls for some of its content online.
The assumption on ITV’s part seemed to be that ad sales didn’t matter so much, highly dangerous with big media agencies jealously guarding their clients’ money (and indeed their clients).
ITV’s May figures actually aren’t all that disastrous because the same period last year saw a big boost to revenues from the World Cup in South Africa. The fear must be that the (relative) drought will last through the summer as advertisers respond to a rapidly-slowing UK economy.
Sainsbury’s has just announced a like for like sales increase of a measly one per cent in the ten weeks to March 19 and forecast that the supermarket sector as a whole can’t expect much more than this throughout 2011.
With UK inflation currently at near to five per cent this is the equivalent of a stonking sales decline.
Last year UK advertisers did uncork their wallets despite saying in things like the IPA’s Bellwether survey that they weren’t going to. There was a post-recession (at least they hoped it was post recession, we’ll find out soon enough when the new ONS output statistics emerge) feelgood factor that persuaded them to chase expensive TV spots on the X Factor and other hit shows.
Few people are feeling particularly good about the UK economy at the moment as coalition chancellor George Osborne sticks rigidly to his deficit reduction plans.
ITV’s managers will have to go out and fight for their money. They could come to regret that Gary Digby and his team aren’t there to lead the troops into battle.