The Fashion Channel
The majority of the viewers of TFC were women, 18-34 years old and the average rating was 1.0. The same audience had been shifting to fashion-related programs on other TV channels, which were both delivering higher ratings than TFC. In particular from Exhibit 1, Lifetime “Fashion Today” had an average rating of 3.0 and CNN’s “Fashion Tonight” of 4.0. That said, TFC was the smallest player in fashion-specific programming based on the average viewer rates, while it takes the highest broadcast time.
This data brought to different concerns:
TFC core audience was shifting to different channels and programs;
A critical number of viewers had to be acquired in order to offer a better defined mix to advertisers and increase revenue generated by Ad Sales;
Keep or increase the average rating in order to be included in cable and satellite offer packages, in order to prevent a downgrade to non-premium packages and consequentially a drop out of viewers;
Therefore I believe the key conclusion would be attracting a better defined segment of potential viewers for TFC, in order to increase the rating, increase the attractiveness of the target audience for advertisers and keep the position in premium content for cable or satellite packages.
Question 2
The first option considered was to maintain a broad appeal to a cross segment of audience, including Fashionistas (the fashion devoted), Planners & Shoppers (fashion enjoyers) and Situationalists (are interested in fashion for specific needs). This approach would maintain the same “something for everyone” strategy TFC adopted until then, which meant keeping the same general audience. The ratings would eventually increase by 20%. By adopting this strategy, the main cons would be