Annual CCTV Spring Festival Gala show attracts 700 million TV viewers, but for how long?

The show may have in recent years drawn its share of criticism - lip synching singers, flat content and, for 2010, a pre-recorded magic segment and clumsy product placement in a comedy sketch - but this doesn’t detract from its standing as a media phenomenon.

But like the Super Bowl, the gala is becoming as interesting for the advertising revenue it generates as for the content itself. This year, the show was estimated to have earned up to Rmb700 million (US$102 million) from ad revenue, up from Rmb500 million in 2009. Chinese home appliance manufacturer Midea, for example, bid 52 million yuan at the 2009 CCTV advertising auction for the right to be the banner sponsor for this New Year’s countdown clock, while the Sichuan Lang Wines company paid 70 million to sponsor the show’s most-popular segment, the 2010 gala appraisal slot.

As the ad revenue numbers show, the annual gala is still an important media property for CCTV, but for how long? Without question, the gala is losing viewers, especially in the younger demographic. Even those who watch the show are less than satisfied. A recent online poll from Sina.com suggested that of those who tuned into the gala, over 50 per cent thought the show was “bad”, while only 13 per cent rated it as “good’.In addition, and reflecting criticism that the gala is too Beijing-focused, a number of regional rivals, including big budget productions from South China-based Guangdong TV and Shanghai’s Dragon TV, have launched. Whether for a variation on the gala theme or for something completely different, Chinese TV viewers are migrating from the CCTV spectacular.

Of course, for many advertisers, including Lang Wines, all of this will mean nothing. For them, the ad buy rationale for the gala is no more sophisticated than wanting to see their product name on the most-watched show of the year, with no thought of wider brand building or integrated communications. But for others, a need to diversify the communications message is paramount. With TV inflation continuing to rise in China, stoked by the CCTV auction mentality, it makes less and less sense to be spending a big part of the annual budget on a select number of TV slots, especially if a significant part of the presumed audience is no longer watching. While the advertising team at CCTV headquarters will no doubt be celebrating another successful gala, it could be argued that the lessons from this year’s show have yet to be fully digested.

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This article was originally published in the 25 February 2010 issue of Media.