Company revenues for ABS-CBN, the largest media group in the Philippines, are well balanced between two business areas closely tethered to a rising middle class: advertising, mainly from free-to-air TV; and consumer sales, including a large chunk from cable TV.

Advertising, the larger slice, accounts for 60%, reflecting the appeal of family-oriented mass entertainment for both viewers and advertisers in a country where few homes have more than one TV.

Nevertheless, ABS-CBN’s president and CEO, Charo Santos-Concio, wants to flip that 60:40 ratio around, with direct consumer sales delivering the bigger share.

“Why not?” she asks. “Advertising money grows by only so much. There is a limit to that. But a direct relationship with your consumer can really be your area of growth.”

A pivotal year

Strategically, 2014 promises to be a cornerstone year for ABS-CBN, as executives raise the tempo on key initiatives.

“We are going through a transition," Santos-Concio explains, "what we call the second curve in our long-term strategic vision for the company.”

One near-term opportunity lies in the kids’ genre. ABS-CBN is already ramping up production of children’s content for a new dedicated channel, part of the company's digital TV portfolio; Santos-Concio wants to build on this momentum with ABS-CBN’s first theme-park.

The broadcaster has secured rights to the Kidzania infotainment franchise, which recreates scaled-down real-world environments - sometimes in collaboration with brands - where young children can role-play possible future careers.

The new venture, due to open in Manila at the end of 2014, forms part of a broader push into new areas such as consumer products, licensing and franchising.

“From there, it’s just going to grow,” Santos-Concio says.

As part of this drive, earlier this year, ABS-CBN also secured rights to 13 properties developed by Mars Ravelo, a Philippine graphic novelist best known for his homegrown super heroes.

These have successfully transferred to film and TV in the past, and Santos-Concio feels it’s time for a revival.

One inspiration is Disney, which re-energized action heroes such as Iron Man and The Avengers from Marvel's library after acquiring the comic book publisher in 2009.
“It’s like a counterpart to Marvel,” Santos-Concio says. “We bought the rights to the Ravelo characters and we’re creating an entire franchise.”

More sports

Another priority for ABS-CBN's CEO is sport, seeking to nurture domestic basketball and boxing in tandem with increased investment in sports content.

“We are partnering with boxing talent management firms and we want to be able to promote local boxing talent,” Santos-Concio says.

“By promoting the talents we are also promoting the sports heavily. There’s a lot of growth there, a lot of future.”

To complement this, ABS-CBN is reinventing its Studio 23 entertainment channel, a flank offering airing on the UHF spectrum, as a sports network.

Studio 23 has already attracted a following for local college basketball content from UAAP (University Athletic Association of the Philippines), which is on air for part of the year. Executives are searching for other sports such as volleyball and football to fill the rest of the calendar.

A sports channel will be another key element in ABS-CBN’s digital TV portfolio, alongside other genres such as movies and kids.

“We already have our foothold in the lifestyle scene and mainstream entertainment, we have our 24x7 news channel,” Santos-Concio remarks.

“Sports is one genre that’s under-developed.”