With consumers’ attention split across a growing number of channels and screens,  brands need innovative ways to reach audiences “where they are”.

One such approach is branded entertainment, or advertiser-funded programming (AFP).

AFP refers to TV or digital programmes created with direct brand involvement. This may be financial, creative, or through granting producers access to talent or events connected to the brand.

It provides the opportunity for brands to participate in and co-create TV or streaming programmes and gives broadcasters and streamers another way to monetise inventory.

However, the concept is not new. A Marketing Week article from 1999 detailed its rise, but it was positioned differently: “Observers say that the terrestrial TV sales houses are arrogant about the existing demand for spot advertising, and remain defensive about bartering their airtime in exchange for a programme. So their call for advertiser-supplied programming has fallen on deaf ears.”

Fast-forward 25 years, and the fractured media landscape makes the proposition more attractive for both brands and broadcasters.

O2’s marketing boss on returning to its founding ethos to ‘reset’ the brand

“Long gone are the days of reaching people through TV [ads] alone,” explains Tesco Mobile’s marketing director Emma Herridge. “We needed different ways that we can resonate with our audiences, and long-form content was perfect for that.”

Tesco Mobile recently partnered with Channel 4 on The Great British Phone Switch, in which parents or guardians swap digital lives with their children for 48 hours. The series is available to stream on both Channel 4 and YouTube.

It’s Tesco Mobile’s first branded entertainment project, and felt like a “natural space” to occupy given the brand’s focus on online safety.

“It was completely uncharted waters for us – a proper leap of faith. However, the cultural landscape and the comms economy are changing, so we recognise that doing the same thing again and again wasn’t going to cut the mustard.”

You don’t want to just piggyback on something where you don’t have a right to play.

Rich Bown, VMO2

According to the latest Advertising Association and WARC Expenditure Report, total TV spend fell –2.1% for the first three months of the year, yet video-on-demand (VOD) increased 5.4%. Meanwhile, spot advertising fell 5.4% to £771m and now accounts for just 61% of the channel’s spend – down from 77% five years’ ago.

Herridge stresses the need to think about media “differently”, not abandoning reach-heavy channels like TV and OOH, but recognising the unique benefits of others.

“The deep storytelling that you can get away with AFP is so different to anything that we’ve done before,” she says.

Although the series has only been live for a month, Herridge says it has already delivered some short-term results, including reaching its target views, achieving “record-breaking” engagement on YouTube and recording a 96% positive sentiment.

“We’re optimistic, when we start seeing those longer-term brand performance metrics pull through, that it’ll have a positive impact,” she adds.

Broadcasters are responding to growing advertiser appetite. Channel 4, as part of its Fast Forward strategy, has expanded its branded-funded output, which allows brands to work with the broadcaster to create TV-like content for social media platforms.

Channel 4 senior lead for content solutions, Jodie Miles, says the launch of the social branded entertainment team in 2020 enabled an “audience-first” approach, recognising viewers are no longer solely watching TV, but also YouTube and TikTok.

“How do we make sure that we are creating content that is for younger generations, rather than just prioritising one channel? We’ve still got a producer-led branded entertainment offering, but now we’ve also got this ability to work on a lot more of these social campaigns,” she adds.

She notes the desire for ad-funded programming is “evolving fast”, as advertisers want entertainment “bursts” or series that span multiple series rather than one-off campaigns.

“We’re seeing a lot of brands say to us: We don’t want this just to be a one-hit wonder or a campaign that happens and then goes. We actually want something that is editorially strong, platform native and insight-driven, so that we can feel a bit like a broadcaster ourselves, and each time come back with a new series with a new creative potential,” she adds.

A collaborative process

Partnerships can be brokered by brands or broadcasters, with commissioners sometimes pitching concepts they feel fit an ad-funded format. While Channel 4’s branded entertainment can take many forms, YouTube has become a key channel, with 60% of its branded content views on the platform coming via TV screens, according to Miles.

“There’s definitely more appetite, and there’s definitely more in the realm of brands dividing their budgets accordingly,” she says.

Meanwhile, ITV revamped its branded entertainment arm to BE Studio in 2023 to specifically work with brands in this area. The rebrand was two-fold, according to ITV’s director of BE Studio, Bhavit Chandrani, who says it aimed to refresh the language around partnerships as well as open up new avenues to exploration.

“Our doors are open to working in effective short-form, social-first content and long-form, ad-funded programming, or what we prefer to call ad-funded entertainment,” he adds, making the distinction to emphasise the “audience-first” principle.

“It has to be entertaining for the audience first – that’s our North Star. Then the brand and editorial team work from there,” he says.

Meanwhile, Chandrani says that in terms of advertiser appetite, there’s been a small increase in the number of brands that are specifically looking for ad-funded projects.

“What’s changed is that we’ve been more open and better placed to capitalise on those briefs,” he explains, adding that the most successful brands take an integrated approach spanning multiple channels.

‘Experts in their field’: Netflix on embracing a culture of ‘context not control’

O2 partnered with ITV for a six-part music series, Studio Sessions – a live performance show where emerging artists, including Becky Hill and Yungblud, played stripped-back acoustic sets at The O2, exclusively for Priority customers.

The series averaged 562,000 viewers per episode, outperforming Later… with Jools Holland (487,000). Becky Hill’s episode drew 775,000 viewers, with 66% of the audience under 54, signalling a strong appeal to younger demographics.

For O2, the partnership came about because the “stars aligned”, according to Rich Bown, head of advertising and campaigns at VMO2.

“We were looking to reinvigorate Priority as part of a relaunch, and wanted to bring it back to market in an exciting way,” he says, noting that ITV made the first approach.

“There was clearly a genuine consumer demand for this kind of content, which ITV had identified.”

Branded and entertaining

Having an “authentic voice” in a subject is essential for effective branded entertainment, says Bown.

“You don’t want to just piggyback on something where you don’t have a right to play,” he says. “We don’t do this kind of deeper, integrated brand activation very often. I would say they only come about when they’re really right, because you don’t want to get it wrong. If you get it wrong, you turn consumers off.”

This principle rings true for Headspace. In 2021, Netflix launched Guide to Meditation with the mental health app, followed by the interactive series Unwind Your Mind. Headspace had originally pitched Netflix a different concept, but during Covid the streamer wanted something more overtly branded.

It was a mutually beneficial match: Netflix offered viewers helpful tools during a stressful time, while Headspace gained a platform on the world’s biggest streamer.

“Getting a series on Netflix really helped drive our larger goals as a company,” says Headspace’s head of content, Sara Cohen, who notes it helped grow brand awareness and drive subscriptions. “It also connected us with harder-to-reach customers.”

The series positioned Headspace as both “a major player” in mental health and “an entertainment creator”. In its first month, international sign-ups rose 70%, search volumes jumped, reach expanded into harder-to-access regions like the Middle East and Asia, Android installs climbed and the show won a Daytime Emmy.

It also opened doors to partnerships, including a Star Wars collaboration in 2022, a kids’ podcast with Sesame Street and an XR headset project with Meta.

Sky, Channel 4 and ITV partner on premium video ad marketplace

However, AFP requires a different mindset from traditional TV advertising. Brands must understand their “limits and remits”, says Bown, and be prepared to relinquish some editorial control.

“I wasn’t sure what to expect in terms of performance – it was a bit of an unknown. There are also fewer measurement points,” he says. “With TV ads, you can more or less predict what your metrics should be going based on the level of investment and years of doing the same thing. This is quite new and unique, so it was hard to benchmark.”

It also requires a “different mindset” according to Herridge, who notes the time, dedication and attention to detail when looking at “such a swathe” of deliverables with different objectives was something that Tesco Mobile hadn’t encountered before.

“Building up that mutual respect and trust and understanding of each other’s objectives and roles was really important,” she adds.

Likewise, leveraging the “credibility” of Channel 4 was a key part of its consideration, because it can talk to audiences in a way the brand can’t.

“From a brand perspective, making sure that we’re talking to the right people at the right time with the right message in the right way was really important,” says Herridge.