Media Week

I saw a very silly film at the cinema last night: the Vince Vaughn vehicle Couples Retreat, based on the premise of four American couples who head off on a "dream" holiday that turns out to be not quite what it seems on the surface.

Silly it may have been, but it was also very entertaining - perfect mindless fare for a midweek evening when a bit of relaxation was called for.

The reason it caught my eye with my Media Week hat on was the blatant product placement within the storyline and as incidental furniture. A Guitar Hero video game segment and a strategically positioned pack of Budweiser beer particularly caught my eye. In fact, it made me and some of my fellow cinemagoers chuckle at the sheer chutzpah of the film-makers in being so blatant about it.

Did I notice it? Definitely. Did I remember the brands? Absolutely. Did it spoil my enjoyment of the film? No.

I can't imagine product placement working in a Bergman-esque movie about the struggle between life, death and love, or a Mike Leigh social realism docu-drama. But, in its place, it is perfectly acceptable and legitimate - as long as it doesn't make a mockery of or overshadow the plot.

For example, I can't see a problem with beer brands appearing in the Rover's Return on Coronation Street. If anything it would make the action more realistic. But it has to be done sensitively and subtly, especially on TV, which is a more intimate environment than a big screen at the cinema.

Battle lines have been drawn for the biggest ever UK media pitch, for the consolidated COI account, and the three shortlisted bids will spend the next two months preparing for a unique clash.

While the account will struggle to hit the £250m the Government communications agency spent in 2008/09, it is still a massive deal, to be fought out by Starcom MediaVest Group and I-Level, pitching as Smile (see what they did there?), a GroupM collaboration called M4C and Aegis Media's Carat, pitching with out-of-home sibling Posterscope.

Omnicom, which handles some COI comms planning through Manning Gottlieb OMD but no media buying, declined to pitch, preferring to concentrate on global accounts. Havas also took a rain check, perhaps deciding it couldn't match the volume buying discounts of its rivals.

Radio Advertising Bureau founder Douglas McArthur, newly appointed chairman of UKOM, helped shape COI agency strategy, convincing it to consolidate buying with one supplier, which seems logical in a converging media landscape.

MediaCom currently handles COI's press, while Carat buys TV and cinema and Posterscope outdoor. Starcom looks after radio and I-Level is digital incumbent.

I-Level spoke to everyone before hooking up with Starcom, which is a double-edged sword for the Publicis agency. It will help Smile leverage I-Level's excellent relationship with the COI, which represents 40% of I-Level's turnover and keeps over 40 people busy. But teaming up with a third party sends out mixed messages about Starcom's in-house resource and fudges the COI's criteria of consolidating buying in one agency.

WPP's M4C brings the other GroupM principals, Mindshare and Mediaedge:cia, into the equation, giving COI the option of choosing which agency it works with in particular areas while retaining group buying muscle.

Carat is TV incumbent and has the digital clout of new chief executive Robert Horler, which may be why it didn't bid as an Aegis consortium that would have brought its Isobar digital arm into the mix.

The prize is enormous for whoever comes out on top and the implications of the COI's decision will undoubtedly send shockwaves throughout media in 2010.

"Who drinks where?" might seem a slightly frivolous subject for an article in a business magazine, but it provides a welcome counterpoint to recent features in Media Week on such heavyweight topics as agency remuneration, procurement, out-of-home advertising business models and the recession.

It's good to vary the media diet and, after all - and especially in a recession - it's well worth remembering that media is very much a people business. Pubs such as The Dudley Arms in Paddington became synonymous with Zenith in the first decade of its existence and The Duke of York and Newman Arms are staking similar claims for the Publicis agency's modern-day planners and buyers, as is the Devonshire Arms for OMD, The Carpenters Arms for Starcom MediaVest - and, latterly, Vizeum - and The Hope for PHD. Other areas of London and media nodes throughout the country boast their own vibrant media scenes.

Media is a sociable business and is so much the better for it - we should not allow the recession to puncture the essence and lifeblood of our industry. It is within the media pubs that the fabric of agencies is renewed and philosophies are defined. It's where account wins are celebrated and unsuccessful pitches mourned. It's where contacts are made and gossip is shared - although be careful not to reveal any state secrets if you stray into a rival agency's territory and have one too many to drink.

If you venture into Fitzrovia, or NoHo if you prefer, on a Thursday night, you will still find the various pubs and bars packed full of media types of all levels of seniority chewing the cud, making contacts, discussing issues, doing business and just plain having fun - and long may that continue.

* On the subject of people and celebrations: next Thursday (29 October) is the big night in the media calendar, as the industry gathers for the Media Week Awards at London's Grosvenor House Hotel in Mayfair. If you haven't booked your ticket yet, do hurry, as there are only a few left. Contact Kate Collins on 020 8267 8188 or kate.collins@haymarket.com
for details.

Yesterday's Bellwether Report, which analyses confidence in marketing budgets for the third quarter of 2009, provided glimmers of hope for a media industry that has endured a battering over the past 12 months.

The IPA's regular quarterly questionnaire of 300 UK-based firms about their planned marketing activities suggests budgets are still falling - for the eighth quarter running - but at the smallest rate since Q2 last year. There has been a surge of confidence in financial prospects ahead and hopes of an economy returning to growth on the horizon.

Of course, everybody is couching this small improvement in modest terms and they certainly aren't crowing from the rooftops about it. This recession has been a sobering experience for many people who haven't worked through such a downturn before.

Even media veterans who are onto their third recession, such as MPG chief executive Marc Mendoza, tell Media Week in this issue's main feature that we may not have seen anything like this before. But it is testament to the resoluteness and robustness of the media business that there hasn't been a plethora of high-profile bankruptcies.

Media companies have acted early and prudently, making tough decisions and trimming costs where necessary. It will hopefully equip agencies, clients and media owners with the tools they need to come out of the recession leaner and healthier, although in a fundamentally reshaped business environment. There is more than £1bn of media business up for pitch at the moment, which means agencies have to work harder than ever just to keep what they've got, let alone think about planning for growth. They are reshaping their businesses to put fee-based income at the heart of their models, rather than commission.

It has been a fraught time for media owners as well, with sales teams staying close to their clients, being extra creative and cutting imaginative deals to eke out every possible penny from advertisers.

The lessons from this recession are worth bearing in mind as better times return. The importance of risk management and contingency planning are likely to remain on the agenda permanently for senior management teams - and that cannot be a bad thing as the industry starts to emerge from its shell.

If you re-read Media Week's interview with London Evening Standard proprietor Alexander Lebedev from a few months ago, there were some strong hints that the Russian oligarch was seriously considering taking the Standard fully free.

He referenced a "world trend with the internet and free news­papers to make money from advertising rather than direct sales" and the inconvenience of "getting 50 pence out of your pocket". These portents were confirmed last Friday, when it was announced that the Standard will be fully free from next Monday (12 October).

The Standard has done well with its selective free distribution around theatre-land and central London Tube stations after 7.30pm. People take and read the papers and tend to keep them when they get off their Tube, train or bus.

Lebedev also noted that, for him, running a newspaper isn't a business in the sense that it is for competitors such as News International and Associated Newspapers. He is a very rich man and sees owning a newspaper as an influencing tool, rather than a profit-maker.

That is just as well. Eschewing around £75,000 a day in cover revenue and the extra cost of distributing 600,000 copies rather than 250,000 will require newly installed ad director Jon O'Donnell to work harder than ever to attract advertisers.

And a free Standard is likely to precede numerous related developments in the newspaper market if rumours are to be believed. The future of the London Lite is still unclear, with some saying Associated is simply waiting a decent interval from thelondonpaper closing to follow suit, or that it is on the verge of selling it to Lebedev, who will in turn shut it down. Others say Associated and News International are set to embark on a joint venture on Associated's morning freesheet Metro, to avoid cutting each other's throats over the Transport for London free newspaper Tube contract. And some still think The Independent will eventually end up under Lebedev's wing.

Paper costs are up 22% year on year. Ad revenue is suffering the harshest recession in living memory. It is no surprise newspaper companies are considering all their options to keep their business models tenable.