Friends Reunited won’t save ITV
Back in November I suggested ITV overpaid for Friends Reunite. Media buyer Mike Colling, on the other hand, believes ‘Friends Reunited’s knowledge will help ITV reinvent itself’, but his four pronged argument is far from convincing.
Mike’s first two reasons, insurance and efficiency, fail to take into account that the two businesses operate on very different scales. Friends Reunited is a simple idea well executed out of a back bedroom, while ITV is a FTSE 100 plc that employs thousands. While there’s no denying that TV ad revenues are down, while internet ad revenues are up, the advertising revenue from an operation like Friends Reunited will be insignificant when compared with that of ITV. Consequently, the deal offers ITV no insurance and any efficiencies gained from a combined ad sales operation will be close to zero. In ad revenue terms, it may be more accurate to liken Friends Reunited to a single TV show, rather than a family of TV channels.
‘Subscribers have willingly confessed some of their most precious secrets – early boyfriends, state of happiness with career, interest in new relationships,’ Mike explains when talking of the wealth of data Friends Reunited brings. While it’s true that Friends Reunited holds an awful lot of data, ITV’s ability to exploit that will be limited. Subscribers may have ‘willingly confessed,’ but that doesn’t mean they’d react well to the commercial exploitation of those confessions. Moreover, there is no evidence this data is relevant to consumer behaviour and to attempt to relate that information to consumer behaviour is to enter uncharted territory.
Finally, Mike expects ITV to benefit from an injection of talent and a cultural shift. Again, the scale of the two operations makes the latter most unlikely. More importantly, forays into dating and genealogy may have been lucrative but are hardly innovative. Friends Reunited is one-trick pony for which ITV has overpaid.
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