Professional football on Wednesday afternoons is rare. Advertisers who get discounts on NFL games are also generally unknown.
But it happens.
Television channels feel the pressure of the NFL’s disappointing results as they are forced to restructure contracts with advertisers to catch up with a small audience and their ability to make money on the remaining games during the lucrative holiday period is limited.
NBC took an unusual step to lower the price it advertisers who had already signed up for the Baltimore Ravens’ Thanksgiving game against the Pittsburgh Iron Company after the Covida 19 flash at the Ravens forced the game to be postponed until next Wednesday.
Some networks are also considering making advertisers pay less for advertising during NFL games and other programs than they originally promised.
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In the meantime, a large portion of the remaining advertising space in the games is allocated to marketers to compensate for unsatisfactory performance, leaving little advertising space to sell in the last quarter of the season. This so-called formatting advertisement is given when the network does not reach the public as promised to the advertiser.
NFL games are the most popular and most expensive television advertising material, as they regularly attract the largest live audience as the audience becomes increasingly fragmented.
But this year’s NFL ranking has been a great success, as pandemic-related delays have made some games less desirable and the coronavirus has pushed some star players into the background. Unexpected competition from other sports leagues, whose seasons have been postponed since the beginning of the year, has also had a negative effect on quotas.
Last season, the NFL, not counting the playoffs, the networks that broadcast the games, earned $3.6 billion in TV advertising revenue, Kantar reports.
A festival of abundant harvest
NBC was probably the toughest day of Thanksgiving, usually the biggest day for NFL viewers. The Ravens-Steelers game, which initially cost advertisers an average of $1 million in 30 seconds of advertising, attracted only 11 million viewers, almost 50% less than last year’s Thanksgiving game on NBC.
Some Thanksgiving advertisers who appeared in Wednesday’s game on NBC didn’t pay at all instead of using the advertising space as a gift for early season games that produced disappointing results, according to people familiar with the subject.
We have worked with each of our partners individually to find what works best for them, according to a spokesperson for NBC Sports in an e-mail. This season we will have broadcast solutions for all our NFL advertisers.
The CBS has stated that it does not adjust advertising prices for its NFL programmes and that it remains selective in the broadcasting market.
Even though we have as much confidence as the NFL – and the audience of the NFL has grown much more in recent years than the prime time channels – we are now in a situation where the NFL is in decline.
…
– Gibbs Hajun, a leading investment specialist in the purchase of Mindshare by WPP.
Networks tend to over-optimize and misunderstand when selling advertising because they can usually easily compensate for a possible shortage of quality products. Even when the goods are taken into account, there are usually still a lot of high-quality, last-minute stocks available for buyers in the so-called dispersion market.
This year it is more difficult to advertise sport, because many events and competitions have been cancelled or postponed. Ultimately, according to the officials of the advertising and media companies, the commercial stocks are not sufficient to meet the needs of make-up and avoid the pile of IOUs.
Another problem is that, while sports audiences are decreasing, entertainment programming is much more, which means that broadcasters are often unable to compensate for the shortage of sports by placing advertisers in their prime time slots.
In the first 13 weeks of the season, Nielsen reported that NFL television and digital audiences for the NFL were 7 percent lower compared to the radio and cable networks that broadcast the games. The male audience in the age groups 18-49 and 25-54, on which the advertisers focus during the games, has suffered more.
Although NFL ratings are down, the games still attract millions of viewers and represent a glimmer of hope in the gloomy television advertising market.
And the demand comes from merchants. Since most of the remaining inventory will be used this year to manufacture products, some brands competing for available NFL retail space are asking for up to 50 percent of what they would have paid before the start of the season if they tended to get better prices, one advertiser said. This represents a significant increase in premiums in recent years.
Other sports
A significant part of the rating downgrades is due to the coverage of the 2020 presidential elections, which chased away the crowd, and the pandemic, which is having a devastating effect on the competition. In addition to the postponed dates and a few small stars, the League has encountered resistance from some fans for its efforts in the field of social justice, including the approval of the Black Lives Matter. These factors are exacerbated by the secular decline of conventional television, whose viewing figures have been undermined by the increase in free and unpromoted television services.
With another crumpled patch, the networks want to be able to use NFL resources to make products after other sports have fought over their own quotas.
But NFL ratings are expected to increase by 15 percent to make up the shortfall in other sports, including baseball and varsity football, they said.
Michael Lowe,
Chairman of the Denzu Media Group, which is buying Amplifi.
Since this has not happened, networks have become more creative in creating products, in some cases taking into account price adjustments, often called cash discounts, as well as digital assets and sponsorship opportunities, he said.
Even with the same confidence as the NFL – and in recent years the audience of the NFL has grown much more than the prime-time channel – we are in a situation where the NFL is in decline, he said.
Gibbs Hajun,
Advantage for the investment
WPP
The advertising company PLC Mindshare. And thanks to the free advertising, advertisers don’t expect the public to make up for this season’s shortfall in the near future.
In some cases, this means cash refunds or an increase in the percentage of goods produced that are reused to realize various opportunities such as sponsorship and social platforms, Hajun said. It’s all on the table.
Corrections and additions The
football match on the second day of the tournament The December match between the Baltimore Crows and the Pittsburgh Steelworkers attracted an average of 21.1 million viewers. In an earlier version of this article it was wrongly assumed that an average of 33 million viewers watched the game. (Corrected on 12 December).
Write to Alexandre Bruell at [email protected] and Joe Flint at [email protected].
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