Oscars advertising continues to dominate all award shows

by Madeline Berg, Forbes

After Sunday night’s broadcast, each Oscar winner will walk away with a 24-karat gold-plated statuette worth an estimated $696. ABC will walk away with over 165,000 times that. Last year, the show brought in $115 million in ad revenue for the network (including $13 million during the red carpet pre show), according to Kantar Media, and with ad prices on the rise, that total will only rise this year.

Behind the Super Bowl, the Oscar ceremony has long been the second most expensive broadcast for advertisers. In terms of ad revenue, the Oscars come out ahead of other awards shows like the Grammys and Golden Globes—last year by $25 million and $8 million, respectively.

This year is no different. Ads have already sold out for the event, and prices increased yet again, with the average 30-second spot costing $1.9 to $2 million, according to Kantar Media. Last year, a 30-second spot during the Oscars averaged $1.72 million, and commercials reached a record-high average of $1.83 million in 2015.

But while ratings for the Super Bowl have stayed the same or increased in recent years, the Academy Awards continue to see ratings fall. The broadcast’s ratings fell 7% last year to 34.4 million viewers, and the show hit an eight-year low in the advertiser-coveted 18-to-40 demographic.

The number of advertisements continues to increase, as well, with 80 total commercials last year. The time dedicated to commercials during the Oscars grew 45% compared to the average between 2007 and 2011.

So if ratings have dropped and supply has increased, why do prices continue to climb?

As the popularity of cord-cutting grows and viewership falls across the board, the Oscars boast a guaranteed substantial audience. Advertisers find this more valuable than ever in today’s fragmented TV market.

“It’s about the marketplace supply of tentpole programs that can attract a large and live-viewing audience,” says Jon Swallen, the CRO of Kantar Media. “That is a species in decline.”

On top of the now-rare opportunity for advertisers to reach so many viewers at once, the Oscars provide a social media bonanza. 24 million Facebook users generated 67 million posts, likes and comments about last year’s broadcast, while Twitter counted 24.2 million Tweets about the the ceremony and nominees.

“Social media creates another opportunity for marketers to develop integrated strategies that combine TV commercials with social media campaigns,” says Swallen.

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