From "The Times"

By Dan Sabbagh: Behind the story-


ITV makes sure the price is right despite complex rules on advertising

The business of buying and selling adverts is surprisingly complex. A series of rules limit how many adverts ITV can sell: the maximum is 24 30-second spots an hour during The X Factor. But ITV must then take away adverts from elsewhere, which is why Piers Morgan’s Star Stories has the briefest of interruptions.

ITV’s prices are capped because it is by far the biggest player in the business, but a series of tricks helps it to boost revenues. The broadcaster will ensure that The X Factor final makes as much money as possible.

ITV starts by insisting that advertisers pay only for the 16 to 34-year-olds who watch the show, because they are the most lucrative target group; in effect it is saying that anybody else is irrelevant. It normally costs about £35 to reach a thousand young adults on ITV1, but with a “special” such as The X Factor that figure is boosted by at least 50 per cent — making the base fee about £52 per thousand.

The advertiser then pays a fee related to the programme’s audience. With somewhere between 3.6 million and 5 million 16-to-34s expected to tune in to the final shows in December, that would produce a figure of between £187,000 and £260,000 per spot.


Source: The Times (online)
http://entertainment.timesonline.co.uk/tol/arts_and_entertainment/tv_and_radio/a...