Broadcast television appears to like the financial buzz it is starting to get from liquor advertising.
This year, with network advertising revenue off about $250 million, or 4.2 percent, in the first quarter compared to last year, local affiliates are not only accepting hard liquor ads — they are actively courting the $451 million distilled-spirits advertising business.
“With the economy and what’s happening to corporations, more and more people are accepting liquor advertising,” said Matt Carroll, the chief marketing officer at Patron, a maker of tequila and rum.
“Everyone who has traditionally not [accepted spirits advertising] now is,” he said, noting that his company’s flagship tequila brand gained access to NBC-owned stations and has been running ads on “The Tonight Show with Conan O’Brien” since Conan took over for Jay Leno on June 1.
CBS dropped its self-imposed ban on spirits and aired a TV spot for Absolut Vodka during the Feb. 9 broadcast of the Grammy Awards. The ad, called “Hugs,” ran after 10 p.m. in 15 major markets, marking the first time a liquor spot appeared on any CBS-owned local broadcast station.
A spirits ad during prime time also marked a sea change for television advertising, executives in the business said.
None of the broadcast networks — ABC, CBS, NBC and Fox — air national ads for alcohol beyond wine and beer for fear of alienating viewers. The practice is common on cable and on independently-owned stations around the country.
But the spirits industry believes it is only a matter of time before the broadcast networks revisit the idea.
“We’re optimistic that the barrier will fall of its own anachronism,” said Frank Coleman, of the Distilled Spirits Council of the US, a trade group. The topic of television advertising was discussed at a recent DISCUS meeting.
“If the owned-and-operated stations are taking them, clearly the networks are seeing that it’s just profit left on the table,” Coleman said.
For years, hard liquor companies adhered to a voluntary ban on television advertising — even as their beer and wine counterparts stayed in the game. In 1996, the liquor industry lifted the ban.
With ad spending off 27.5 percent in the spot, or local, market in the first quarter and down by 9.7 percent, or $1.6 billion, throughout the entire television media landscape, it is no wonder television ad executives are drinking in the newfound revenue stream.
In 2001, NBC tried a brief foray into liquor advertising when it ran an ad for Diageo’s Smirnoff vodka on network television. Within months, NBC backed down from the idea after opposition from critics of the idea.
Pernod Ricard USA, the maker of Absolut, also aired an ad for its Chivas Regal Scotch whiskey during the Conan O’Brien show. The ad ran on NBC-owned stations in several markets, including New York, Chicago and Dallas.
Spirit makers insist they adhere to a stringent code the industry adopted that limits exposure to people below the legal drinking age. Patron said more than 70 percent of the audience for the Grammys is 21 and older, and well above the minimum set by the spirit industry’s code.