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Johnston Press re-evaluates Sky AdSmart deal

Last year, Johnston Press signed up – some say naively – Sky AdSmart to their bank of local advertisers. The deal is now under review as the regional newspaper publisher fears it is losing customers to the broadcast giant. Ashley Highfield, the Chief Executive of Johnston Press, said: “I think it is one of those products which we need to think hard about in terms of whether we are giving potentially some of our best customers away.” Indeed, who would have thought?

Based on the cost-per-thousand (CpT) impacts, AdSmart only has to work twice as hard as local paid for press to drive a similar cost per response. TV generally is 3 to 7 times more efficient than local press – so it is no surprise that Johnston Press are now desperately trying to close Pandora’s box. The fact that Johnston is severing ties suggests a lack of benefits of AdSmart for these hyper localised campaigns. But how does it stack up as a national direct response (DR) channel 2.5 years after its launch?

AdSmart is still around 10 times more expensive than straight acquisition airtime (even at entry level) and for national brands this stops it working at a DR level. Now, secondary audiences are intrinsic to DRTV success, and AdSmart may give you a tighter target audience who will be more interested in your product, both in terms of attitude and locality. But what about those floating or undecided consumers? Gambling companies are generally trying to reach 18-34 year old men, but what about the older, less prolific gambler who may be more cautious but is also in the market for decent odds?

Acquisition TV is a numbers game and yes, it is important to have a tightly targeted campaign, buying the right stations at the cheapest possible price. With AdSmart however, restricting our buy to a particular postcode with a high proportion of your preferred audience profile does not necessarily mean that everyone within that postcode will be buying your product. Of course, they are more likely to, but ten times more likely to? I highly doubt it.