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before big $ travelers
Ads on cable go into guest rooms of posh hotels
By Kathy Prentice
The traditional advertising medium of television is the vehicle for a new out-of-home venture: commercials on cable channels in upscale hotels.
Tight targeting is the appeal for advertisers. Both the hotels and cable channels are carefully chosen to appeal to a high concentration of affluent business professionals.
To find out how to get your client on the tube at upscale hotels, read on.
This is one in a Media Life series on buying the new out-of-home venues. They appear weekly.
Fast Facts
What
Traditional broadcast ads placed exclusively on cable channels in upscale hotels.
Who
Hotelevision, headquartered in New York City.
How it works
Hotelevision broadcasts mirror regular cable networks, so that during breaks in programming while viewers at home see a commercial, hotel guests viewing the same program see a targeted Hotelevision commercial.
Advertising averages 12 minutes per hour per network, appearing in all national and local commercial slots.
Each commercial is inserted across all nine advertiser-supported channels, or roadblocked.
A network can be omitted at the advertiser’s request, says Jeff Stettin, senior vice president for advertising sales.
Spots are 15, 30, 45, 60, 90 or 120 seconds.
Creative is provided by advertisers and is typically the same spots that they run on other networks.
Advertising messages can be changed throughout a flight.
“Content can be book ended or piggybacked or changed from morning to night,” Stettin says.
Advertisers often use the medium to highlight a specific service for a targeted audience.
“We used 15-second spots to focus on United’s Economy Plus,” says Mary Duncan, media supervisor for Fallon Worldwide of Minneapolis. Fallon placed a United Airlines ad on Hotelevision.
Advertisers can sponsor generic travel vignettes, Stettin says. “For example, travel tips could be brought to viewers by an airline or health tips by a pharmaceutical.”
Sponsored messages run adjacent to the advertiser’s standard commercial.
Sweepstakes can also be tied to a brand. For example, a golf getaway could be sponsored by a golf club or a luxury auto, Stettin says.
Ads are aimed at affluent, decision-making, traveling professionals who make up the top 1.2 million or 30 percent of domestic guests. The hotel base averages $175 per night and 350 rooms per property.
Weekend leisure travelers are also targeted.
“We’ve learned that people who travel most for business also travel most for leisure,” Stettin says.
“During the week audiences are 70 percent male,” Stettin says. “On the weekends it’s closer to 50/50.”
The value of the venue in its ability to deliver the consumer with little outside distraction.
“There’s the question of where you’re reaching people. These affluent business professionals are a mobile, elusive audience,” says Steve Pacheco, director of advertising for Memphis-based FedEx.
“You’ve only got them for a short amount of time at the end of the day while they’re still focused on business, and in a hotel they’re a captive audience. There aren’t a lot of distractions. There are no kids downstairs yelling, no dog to let out.”
Hotelevision delivers ads by satellite to hotels, at no cost, to supplement existing channels.
Service is turnkey.
Hotelevision currently transmits 10 channels: The Biography Channel, Bloomberg Television, CNBC, ESPN Classic, FOX News, The Golf Channel, History Channel International, MSNBC, STARZ! and The Weather Channel. STARZ! doesn’t air commercial advertising, but is included to enhance the cable package.
“News, cultural and sports shows were the common theme when we surveyed travelers to see what they want,” Stettin says.
Hotelevision is used as a component of mixed media campaigns, Stettin says.
“It’s a really nice compliment to advertising that maybe has gotten reach through CNN or a history channel and now the advertiser wants to hone in on an affluent audience.”
Advertisers are all national companies.
“We send identical feed to every hotel so it wouldn’t be cost efficient for a car dealer in Chicago to air all over the country,” Stettin says.
Exclusivity can be negotiated in some categories. Additionally, there is no risk of a local advertiser coming in and violating exclusivity.
Markets
Hotelevision is in 37 of the top 40 DMAs in the U.S., including a presence in all top 15 markets.
Hotels
Hotelelvision is currently in 150,000 rooms in properties including Hyatt Hotels, Omni Hotels, Tarsadia Hotels, Winegardner & Hammons, Wyndham International, Doubletree, Embassy Suites, Fairmont, Hilton, Loews, Marriott, Sheraton, Holiday Inn, Radisson, Crowne Plaza and Westin.
Numbers
How measured?
Measurement will soon be provided in a manner similar to measurement of in-home viewing.
Research
Approximately 90 percent of upscale hotels offer an average of six cable networks to guests who watch in excess of 3.5 hours of television per day.
Eighty-four percent of guests pay as much or more attention to television in hotels as they do at home.
Television was rated the number one in-room amenity.
Hotel guests watch more cable than other television programming with 47 percent of in-room viewing cable, 38 percent broadcast television programming and 6 percent pay-per-view movies.
Ninety percent of hotels have an average of six cable network channels, though 71 percent of guests are dissatisfied with the number of channels and 69 percent are dissatisfied with the variety. Source: Hotelevision electronic metered study tracking guest viewing patterns and focus groups of frequent travelers.
In 2001 cable television receipts totaled $14.4 billion. Automotive topped spending with $917 million in advertising expenditures. Financial services came in second with $759 million. Source: Cable Television Advertising Bureau
What product categories do well?
Airlines, car rentals, wine and spirits, tourism boards, insurance, internet, automobiles, electronics, magazines, credit cards, shipping, computers and software, pharmaceuticals, financial and banking services, telecommunications, travel, sports equipment, clothing and jewelry.
“One unique aspect is that we are able to accept liquor advertising,” Stettin says. “It’s point of sale advertising with mini bars an arm’s length away and lounges just steps away.”
“We don’t accept 900 numbers,” Stettin says.
Demographics
The target audience is business travelers staying at upscale hotels. Hotelevision viewers are more likely than the general U.S. population to do as follows:
- 364 percent more likely to earn $150,000 plus
- 490 percent more likely to earn $100,000 plus
- 549 percent more likely to take nine plus domestic flights per year
- 464 percent more likely to own an American Express Gold card
Source: 2001 MRI Doublebase Study
Hotelevision viewers compare to the general U.S. population in the
year 2000 as follows:
- 607 percent more likely to be heavy users of car rental for business
- 326 percent more likely to have purchased mutual funds in the past year and 301 percent more likely to have purchased stock
- 263 percent more likely to have a post-graduate degree while 211 percent have a bachelor’s degree
- 242 percent more likely to have purchased golf clubs
- 236 percent more likely to be professionals and managers
- 234 percent more likely to have acquired a new credit card
- 222 percent more likely to have bought a powerboat
- 220 percent more likely to have acquired an auto loan for a new car
- 219 percent more likely to have acquired a home mortgage
Source: 2000 MRI Doublebase Study
Making the buy
Lead-time is one day.
General economy of scale affects pricing, Stettin says. “People
spending more will get a price break.”
Advertisers typically buy six-week flights.
Specific days or portions of weeks within a flight can be purchased
depending on availability of inventory.
An incentive is offered for advertising first in a category.
Generally, pricing is 25 to 50 percent less on a CPM basis than the
most affluent national cable networks, Stettin says. “If an advertiser is
looking to reach an adult demographic earning $75,000 or more, they would
come in at 25 to 50 percent less.”
A minimum buy is $25,000.
Sales offices are in New York City, Atlanta, Dallas, Los Angeles
and San Francisco.
Who’s already on Hotelevision?
FedEx, United Airlines, MONY, 1-800-Flowers, AXA Financial,
Australian Tourist Commission, Palm Inc., Travelocity and others.
What they’re saying
“The main thing is being able to reach business travelers as they
are actually traveling, at the time they’re considering and reconsidering
purchases in their travel decisions.” – Mary Duncan, media supervisor for
Fallon Worldwide, headquartered in Minneapolis. Fallon placed a recent
United Airlines campaign on Hotelevision.
“It reaches the road warriors, a highly mobile, highly
affluent and psycho-graphically-get-it-done, make-it-happen type of people,
which is a really good match for FedEx.” – Steve Pacheco, director of
advertising for FedEx, headquartered in Memphis.
“The two founders of the company were not in the media
business. They were business travelers whose pet peeve was that the average
hotel had no television to speak of. The reason is hotels have to pay
monthly for cable, per room, and it’s expensive. So they figured a business
model to bring in channels without costing hotels.” – Jeff Stettin, senior
vice president of advertising sales for New York City-based Hotelevision.
Web site info
Hotelevision at
www.hotelevision.com
March 25, 2002 © 2002 Media Life
-Kathy Prentice writes about out-of-home advertising for Media Life, penning her stories from the resort town of Traverse City, in the upper reaches of Michigan.
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