Pitch man. Vitold Chrzanowski leads TV Markíza's bid for Slovakia's tiny TV ad market.
"There is just not much money in this market," explained Viera Stadtruckerová, a sales representative for IP, the agency representing STV and the small private station Vaša Televíza (VTV). According to her figures, television advertising revenues in Slovakia in 1995 were 700 million Sk ($23 million). Of that figure, STV reeled in 400 million Sk, 57 percent of the ad pie.
Audience share is a critical gauge in the battle for ad revenue. In a survey conducted before Markíza came into the picture (see graph), STV's two channels controlled a 51 percent audience share, while the Czech station TV Nova, the most watched cable channel in Slovakia, had a 21 percent Slovak share. VTV held 9 percent.
But TV Markíza is not daunted by the competition. Although run by its Slovak owner, Markíza, Ltd., the network is the brainchild of Central European Media Enterprises (CME), the US-based company responsible for TV Nova, PopTV in Romania and ProTV in Slovenia. Along with its money and experience in the TV market, CME has also imported a hired gun, in the form of ad sales director Vitold Chrzanowski, an American who used to work with Paramount and Columbia pictures. His job is to guarantee CME sees a profit within 5 years.
He is confident that will happen. "Before, the advertising community was essentially dealing only with STV and did business only one way - their way," said Chrzanowski. "We're not playing that game. We're not STV, and we're not IP; we want to establish our own game with our own ground rules."
Selling an unseen product
While Markíza depends upon advertising for about 90 percent of its revenue, its sales reps are pitching its untested product at premium prices (see chart). The strategy is that Markíza, covering 60 percent of Slovakia, is a better choice to potential clients than STV. Though often criticized for weak programming, STV still has a lock on coverage: its signal reaches 99 percent of the Slovak population. But according to the media research firm GfK-AISA, only about half of TV-viewing Slovaks say they watch STV1.
Markíza wants to capitalize on that perceived staid image. "The end of boring television!" billboards trumpeted across Slovakia during the weeks before the new station's launch. While STV's media kit plays up the traditional viewers the station pulls in - 70 percent of STV1's viewers are over 50 years old - Markíza is targeting a younger, hipper audience. A light morning show, brand-new Slovak sitcoms, and American movies like "Pulp Fiction" and "Demolition Man" make up just part of the youthful equation. "Our primary audience is adults 15-39," Chrzanowski said. "That's what we're selling."
Statistical sales assault
Markíza's personnel boast that 70 percent of all Slovak retail sales and 80 percent of investments occur in its coverage area. Chrzanowski hopes those numbers will convince clients that Markíza can access an affluent audience willing to spend.
But the way that the Slovak market stands now, sheer numbers of viewers may be more desirable than big spenders. Unlike in the West, where big-budget items like cars and computers dominate the ad scene, the biggest buyers of Slovak TV time are the makers of low-cost, fast-moving "package goods" like food, soap, and cosmetics. "The naturals, the people that are really going to make or break this station in terms of their commitment from a revenue standpoint are your Proctor & Gambles, your Unilevers, Ben Keiser, Henkel, and so forth," Chrzanowski said.
That could make Markíza's job tougher. For example, housewives, not Markíza's primary market, make up Proctor & Gamble's target audience, said Ivana Praženica, an employee in the company's Prague-based advertising department. "But I can say that we would advertise on any station with a high enough viewership in our target market."
For now, STV has some of Markíza's hot prospects in the bag. According to IP's Stadtruckerová, the public station's top clients include Unilever, Coca Cola, Jacobs Suchard, Nestle, Johnson & Johnson, and Wrigley's. But it remains to be seen whether STV can hang on to its big supporters.
"For a Proctor & Gamble, there is no reason to spend more money [on the Slovak TV market]," said Milan Lechnický, the strategy planning director for Istropolitana advertising agency in Bratislava. "I think they will only switch stations." Lechnický predicted that Markíza's market share in its coverage area would total about 70 percent, with STV slipping to 30 percent or less.
Chrzanowski said that Markíza has exceeded 75 percent of the estimates in its advertising revenue plan, although he would not reveal concrete numbers. Rather than relying on standard advertisers, Markíza's ad team is looking to expand the Slovak ad market. For example, Chrzanowski said, they are chasing SlovTel, which just won the country's mobile phone tender and "should be a very, very new important advertiser here," Chrzanowski said. Another vision is to set up partnerships between auto manufacturers and banks, based on the principle that if more people can finance a new car, more car dealers will advertise for them.
Such steps could help push the market to evolve. "Advertising expenditures in TV depend on the market," explained Lechnický. "If there are new products or new companies entering the market, especially companies with mass-produced goods, this is a reason for increasing expenditures." One thing is for certain, Lechnický added, "the TV market from September will be completely different from what it is now."
28. Aug 1996 at 0:00 | Hannah Wolfson