By year six, when Lamont expects to put her station up for sale, she's counting on about $8 million in net sales and at least a 6% market share. That would translate into about $2.4 million in aftertax profits and, better still, nearly $3.5 million of positive cash flow.
MARKETING: But getting from here to there will take more -- much more -- than tight control of WCCL's purse strings. Lamont must figure out how to carve a niche for her station in a market that was already saturated without her. (Most midsize cities like New Orleans, which is the 35th-largest TV market, have three network affiliates and only one or two indies.)
Lamont turned for help to a man she considers one of the marketing geniuses of the industry -- George Stantis, a veteran of more than 30 years in the management of independent as well as network-affiliated TV stations. The pair faced some real obstacles: the New Orleans market, depressed as it is, is heavily dominated by one station, owned by Loyola University, a Jesuit institution with less incentive to show a profit and thus able to keep its commercial spot prices low. To make matters worse, the two non-network independents that WCCL planned to tackle were owned by the Tribune Co. and TVX Broadcasting Group Inc., backing that gave them the kind of marketing, programming, and staying power that a thinly capitalized station like Lamont's just wouldn't have.
Lamont and Stantis decided to position the station as the city's "local" alternative -- not as improbable as it might sound, since Lamont and the Jesuits are currently New Orleans's only home-based television-station owners. To build up their local image fast, Stantis adopted a logo mascot: a well-known French Quarter mime who looks like Charlie Chaplin with shocking-red hair. His image was eye-catching, especially when WCCL splashed it for three months across city billboards, complete with a 22-foot spinning cane. "We came to town and tried to sell some sizzle," Stantis says.
They had no other choice, because there weren't going to be any market-share numbers to speak of, perhaps for quite a while. After all, it takes time to attract viewers to a new station. And WCCL faced an even tougher battle precisely because Lamont had done such an admirable job of penny-pinching on programming: her competitors could pull viewers in with shows such as Oprah Winfrey's and Arsenio Hall's while she ran cheapies on the order of "Room 222." Unfortunately, many potential advertisers decided to wait for proof of at least a 3% rating before they would consider buying into a show. And WCCL has been able to score that only at scattered time periods as recently as August, when official July ratings were issued.
The reason for WCCL's rating-share shortfall actually has less to do with its programming than it does with a Supreme Court ruling that put an end to an FCC regulation known as "must-carry." The regulation had required cable operators to carry every television station located within a specified area. Now, cable companies have the right to decide whether to carry a station, which they do on purely economic grounds.
Some indies have closed up shop to conserve cash and hope for congressional intervention, but Lamont, always a fighter, decided to tough it out and try to build market share without the help of must-carry -- despite the fact that one of the city's two major cable carriers, the one that serves the desirable, upscale Jefferson Parish, has only recently reconsidered its earlier refusal to carry her station. "I went home feeling pretty devastated when I found out that we were the only local station they had decided not to carry," Lamont recalls. But then she and Stantis launched a lobbying campaign aimed at every relevant government official from the Jefferson Parish city council all the way up to Congress, even targeting representatives from Atlanta, where the cable carrier's parent company is based. At press time, the two were waiting for the carrier to make a commitment to carry WCCL-TV.
Meanwhile, Lamont has been forced to be imaginative -- to put it mildly -- in her efforts to build audience share by "counterprogramming" the existing offerings from the network affiliates and indies. In a time slot where all of the other stations are showing the news, WCCL schedules a game show. Or if there are situation comedies on the other stations, WCCL will offer an action show. The goal is always to provide an alternative to what the competitors offer.
Local programming, particularly sporting events, is clearly the best way to capture audience share and advertisers quickly, but it's costly to produce; also, most of the desirable sports events are already contracted for. WCCL managed to score one touchdown when Lamont negotiated her way into an exclusive five-year contract to produce and syndicate the Bayou Classic, the Superbowl of black-college football games. And she has just followed her WCCL-produced show, "Step by Step Cosmetic Surgery," with a new entry, "Saints' Better Half," which takes a weekly "intimate" look at the tumultuous (she hopes) home lives of New Orleans' professional football players.
Lamont and Stantis also have been forced to be inventive about selling their ad time. And that doesn't just mean offering good discounts -- which of course they're doing. "We're reaching out to a lot of advertisers who have never tried television before; we can produce their commercials for them right here in our own production studio," says Stantis. So far, results are positive. One locally based store concluded that increased sales paid for the cost of producing and running its WCCL commercial six times over.
The pair scored a real coup -- and won credibility -- this summer when they convinced a major national ad rep firm, Blair Television Co., to take them on as a client. But the question now is whether they can attract national advertising to a sluggish market: net ad revenue in the city was only $75 million in 1988, not much better than the $58 million netted in 1983.
FINANCE: While Lamont's marketing problems are large, her financing difficulties have often seemed insurmountable. WCCL lost some of its original investors in 1985. "I went to all the big Wall Street firms looking for new backers -- but nobody wanted to hear anything about an independent television station, especially one in Louisiana," she says with a laugh.
But by then the company had spent nearly $1.5 million on lawyers' fees and settlements to other applicants for the same frequency (the procedure encouraged by the FCC in such cases). So Lamont had no intention of giving up her hard-won license. Instead, she gave herself a crash course in government incentives for entrepreneurs -- especially minorities, since she's black -- and came up with a shrewd substitute for all those nifty tax breaks that TV-station investors had lost. She offered her backers minority tax credits, which allowed them to earn tax-free dividends on their WCCL investments, the first time MTCs had been used for a television start-up.
