CNN International Commercial’s Rob Bradley and James Hunt explain the broadcaster’s ambitions for its CNN Reach consultancy, and why its latest sales deck doesn’t even mention the word ‘advertising’.
Understanding media brand ownership nowadays is a bit like peeling back the layers of an ever-expanding onion. Following a breakneck 24-month period of industry consolidation, which has seen – among other deals – Disney swallow up Fox and Comcast acquire Sky, it is trickier than ever to trace the path from ad inventory to parent company P&L.
Take CNN: the broadcaster, one of the globe’s most well-known TV brands, is now a part of WarnerMedia News & Sports, one of four subsidiaries within WarnerMedia – formerly Time Warner – which itself, since last year, has been a part of US telco behemoth AT&T.
Of course, new ownership provides opportunities for CNN beyond simply added scale. AT&T is positioning itself as a leading player in the upcoming drive to upgrade US cities to 5G mobile bandwidth, while the company’s Xandr ad tech stack – including AppNexus, another 2018 acquisition – will be central to its efforts to build an addressable TV ad business.
CNN’s International division is also evolving its model. Like many media owners, it has assembled a brand content creation studio, Create Group, through which 60% of its brand partnerships pass. It has also debuted a new consulting unit, CNN Reach, to assist clients with the planning and creation of content campaigns, to advise on distribution – including media buying services both on and off its own platforms – and to enable audience targeting across the broader WarnerMedia portfolio.
WARC met with Rob Bradley, CNN International Commercial’s Senior Vice President, and James Hunt, Vice President, Create Group, to find out why the broadcaster no longer considers itself to be merely a “media company”.
Given all the recent changes in the media industry – and specifically at WarnerMedia – how are you evolving your commercial model at CNN?
Bradley: We started a journey four years ago – it’s not finished and never will be. If we were just out there selling ads today, we wouldn’t last very long. We have to be more – we’re a data company, a tech company, a creative agency, a media content consultancy. That consultancy piece is really what we go to market with. Our new sales deck doesn’t say the word “advertising” and doesn’t show an ad format at all, it talks about what brands need to do to connect to consumers. In really embracing the fact that we can’t just be a media company any more, that means that we are dramatically changed from the place where we were just selling banners and TV [ads]. 60% of our revenue touches our in-house creative agency now – it was just under 50% last year.
Is this new approach being led by expectations from brands, or changes in audience behaviour?
Bradley: Ideally it meets in the middle. Audiences demand what they want, when they want it. As big as we are, we can’t change human behaviour. We need to understand it and make it work for us. A micro-version of that in our industry would be programmatic: the big media owners that didn’t embrace it back in the day were worried that they couldn’t make it work for them, so it worked against them. You need to embrace new platforms [and] understand them, instead of being fearful. One thing that we have never stopped investing in is our own environment. If you don’t have something that you control, and you’re relying on other people’s business models – well, you saw [when] Facebook changed its algorithm, businesses [struggled]. Of course, we rely on those platforms for distribution, but we’d be fine without them as well. Our model is to make them work for us and to partner in meaningful ways, but always invest in our own original brands first, and to make sure we can be more creative in our own environment.
Context seems to be a major topic of debate for media owners. Is that argument resonating with brands?
Bradley: It’s pretty crazy, really. Media companies were just selling people and not thinking around the world they might be interested in in that moment. In a world where you could have both – context and the user – why wouldn’t you? I take context out of the screen as well. What’s the weather? What time of day is it? Am I shopping, or in the office, or a taxi? Context is more than just the screen area, and technology exists to allow you to go beyond that.
Complexity continues to be a big issue for clients. Is that key to your sales pitch for the newly-launched CNN Reach consultancy?
Bradley: We are one of the truly global media brands, and we understand how to talk to people all over the world – we’ve been doing it for 40 years. It is taking advantage of that extra knowledge that we have. We have one of the biggest owned and operated media platforms, we’re one of the biggest brands by social metrics. I’m not trying to sell these things: what is important is that we understand all of this. If we’re just sending slides and the spreadsheet of costs, it’s not going to go very far. We need to be deeply upstream, both with agencies and brands, because agencies also use consultancy to understand the whole picture of the content they’re making. [The idea] is to try and leave them with real business insights and information that can help change that business, [to] show them an audience they didn’t know existed for their brands. Tell them something they didn’t know before.
Hunt: That is what our data team can do – actually understand the nuances about those audiences and then create a campaign that then touches across all the cells within that demographic. With targeting, we have the ability to really focus around what ads and creative we use. Hopefully you’re [then] pushing relevant content for those audiences.
Presumably this helps CNN to prove it is not selling a homogenous business audience?
Hunt: Yes. This is one of the things that we talk about all the time, our traditional C-suite CNN audience, which everyone is very comfortable with. One of the things we talk to clients about is [that our] homepage is an incredibly powerful tool. People still type CNN into a browser, [also for] other interests our audience [might have, such as] travel, lifestyle. We hit those broad demographics.
How important is content in helping brands target audiences around those other interest segments?
Hunt: That’s probably another reason why we feel quite different today. Yes, we have some agency relationships, but we have a lot more direct client relationships, like with Cathay for instance. Yes, they have their agency partners as well, but the ability to work directly with clients and create content directly, and get more latitude, is quite nice.
Bradley: There are benefits of both [agency and client-direct relationships]. When we’re working in Asia, Africa or the Middle East, there is a lot more direct activity. It will be interesting to see how it plays out with consultancies like Accenture and PwC coming in saying and, ‘hey, we understand your whole business, so maybe our 3,000 data people could help your marketing.’ That’s a real challenge. That’s where you are seeing media companies and agencies leverage each other skills. There’s room for everyone. It’s not a shrinking industry, it’s growing.
Do you sense any content marketing fatigue among your clients?
Hunt: We’re lucky in that we still do have a nice balance of the different platforms, and TV is still is at the centre of our campaigns. Around 75% to 80% of our campaigns are cross-platform. We have a long history of working in the TV space, and now [we’re seeing] a lot more digital and social elements, as you’d imagine. With regards to branded content [specifically], clients still want to talk to us about [it] as part of their marketing mix. 60% to 65% of our revenue comes through video – video is still the primary thing that we do for all of our clients, [and] social video has really changed the game from us. 5G is really going to change things for brands, and being owned by AT&T is going to allow us to be at the forefront of that.
Bradley: We’re blessed in that when you’re dealing with bigger budgets and cross-market budgets, when they’ve committed seven million bucks or whatever it may be, people need to make it work. That means there is room to do more. If brands are working with fewer partners, but in deeper, more meaningful ways, then [it encourages] rebooking. The goal is not just three-month partnerships.
Read other exclusive WARC media owner interviews:
Media owner spotlight: Facebook on why advertisers must understand their own brand safety ‘tolerances’
Media owner spotlight: Understanding Activision Blizzard’s approach to in-game mobile advertising