Academy Awards Ad Cost, Clutter Reach Record Highs
Local advertising, social media campaigns provide other opportunities for leveraging interest in the awards telecast
New York, NY, February 19, 2016 – Millions of TV viewers will tune in to the 88th Academy Awards ceremony on February 28th, whether to satisfy their desire for Hollywood glamour or perhaps to see if host Chris Rock weighs in on the au courant topic of racial equality and diversity in the movie business. An elite group of marketers will also vying for a spot on the red carpet, paying hefty prices to be associated with this marquee event and the opportunity to reach a media-savvy audience dominated by women.
Kantar Media has mined its extensive database to compile key figures on Academy Awards advertising. Significant trends include higher ad prices and revenue; rising ad clutter that is diminishing the event’s advantage versus other programming; TV sponsor overlap with the Golden Globes and Grammys; an influx of first-time advertisers; the use of regional TV buys to circumvent exclusive-sponsor arrangements in the network telecast; and brands creating second-screen experiences to compete for share of social media voice during the live broadcast.
The Price of Advertising Moves Higher
In 2015 the average price of a 30-second unit in the Academy Awards surpassed $1.8 million and total revenue reached $110 million, both all-time highs. The robust pricing reflects advertiser demand for live TV events that can generate strong engagement in social media, coupled with the desirable profile of the viewing audience
The average cost of a 30-second spot in this year’s ceremony is expected to be $1.9 to $2.0 million.
The Academy Awards, Grammy Awards and Golden Globes are the top three awards shows on broadcast television and occur within weeks of each other. The Academy Awards commands a significantly higher advertising price and generates more revenue than the competing programs.
Advertising Time Is Increasing
As host of the awards ceremony, the AMPAS controls and limits the amount of commercial time in the broadcast. And yet the total amount of network ad time from paying sponsors has increased by nearly 25 percent during the past 5 years, reaching an all-time high of 29 minutes, 45 seconds in 2015.
In addition, there are 5-6 minutes of promotional spots from ABC and 7-8 minutes of ads sold by local ABC stations throughout the show for a total commercial load of 42-44 minutes, or about 12 minutes per hour for a 3 ½ hour live telecast.
Yet while ad clutter is growing during the Oscars, it still compares very favorably with other programming. As a reference point, the comparable amount of ad time (national plus local) in the 2016 Super Bowl was 53:20 for a 3 hour, 43 minute game which was a bit less than 15 minutes per hour. The typical range for prime time entertainment programming on broadcast and cable networks is 17-20 minutes per hour.
Spending By Top Advertisers
During the past five years the top five parent company sponsors in the Academy Awards have spent $206 million in the telecast, accounting for 46 percent of total ad revenue.
Two of these companies will not be involved with the 2016 event. JC Penney’s deal as exclusive retail sponsor ended in 2015 and it has been replaced by Kohl’s for 2016. Hyundai was the exclusive auto sponsor from 2009-2013 and was supplanted by General Motors in 2014.
Two other well-known marketers stand out for their loyalty and longevity. McDonald’s has appeared in the program every year since 1992 and American Express has appeared every year since 1993.
First Time Sponsors
The combination of limited commercial time and marketers with guaranteed category exclusivity results in a relatively small number of companies appearing in the Academy Awards. However, there is turnover and recent years have seen an influx of new sponsors eager to capitalize on the event. In 2015, first-time advertisers accounted for 30 percent of the Academy Awards lineup.
The first year class of 2015 was Comcast, Discover Financial Services, Kings Hawaiian Bakery, Netflix, Petsmart, Sonos and Zillow.
Sponsor Overlap: The Quadruple Play
Four major TV events are compressed into the first two months of the year – the Academy Awards, Golden Globes, Grammy Awards and Super Bowl. Despite the high prices for commercial time, the disparate audience profiles and the calendar proximity, some marketers appear in all four events.
In 2015 six parent companies executed this quadruple play – Comcast, Discover Financial Services, Mars, McDonalds, Softbank (owner of Sprint), and Walt Disney.
Sponsor Overlap | Number of parent companies participating in major 2015 TV advertising events
2015 was a notable year for this strategy. In the preceding four years combined, it occurred only five times and Sprint is the sole advertiser to have done it twice in this period (2015 and 2014).
Local Market TV Sponsors: A Second Battleground
While most attention is focused on the national TV commercials appearing in the Academy Awards, affiliate stations in local markets also have an allotment of air time to sell. This inventory offers another way for sponsors to access the event, albeit on a regional basis.
For many years, ABC has sold automotive category exclusivity to a single company, typically for five year periods. (General Motors currently holds the rights). This has prevented rival manufacturers from airing national spots in a program they would otherwise jump into. For perspective, the Super Bowl does not have an exclusive auto sponsor and eight different auto companies bought time in the 2016 game.
This leaves local markets as the only access point for other auto marketers to reach viewers with messages. It’s a strategy pursued with exuberance. Across the Top 100 markets, auto accounted for 33 percent of all local ad time in the 2015 Academy Awards. Auto ads appeared in 95 of the 100 markets and the average market had competing messages from four different brands. Eight different category advertisers ran spots in at least 20 of the Top 100 markets.
The restaurant category was also very active regionally. McDonald’s supplemented its one national spot in the ceremony with local buys in 23 markets. Arby’s, Chick-Fil-A, Dunkin Donuts and Jack In The Box each aired commercials in 15-20 markets.
Social Media Integrations
The Academy Awards broadcast stimulates plenty of discussion on social media, mostly about the award winners/losers and celebrities. There is little opportunity for sponsors to leverage the event and generate online conversation on behalf of their brands. But each year a few advertisers with paid spots in the TV broadcast try a second-screen approach utilizing owned content distributed from the brand’s social media account. Examples from 2015 included Dove, Coldwell Banker and Cadillac.
As part of its #SpeakBeautiful campaign to promote self-esteem about beauty and body image, Dove aired a :30 second spot during the Red Carpet coverage that included the sobering headline, “last year women sent over 5 million negative Tweets about beauty and body image.” The ad encouraged women to start a trend by Tweeting positive statements and to “speak beautiful.” As a complement to the TV message, Dove made use of a Twitter tool to flag tweets with negative references about appearance or beauty and automatically tweeted back a positive reply from Dove’s Twitter account. According to statistics compiled by Unmetric, a Kantar Media partner, Dove tweeted almost one thousand replies and generated more than 26,000 interactions during the awards show.
Real-estate broker Coldwell Banker used the 2015 Academy Awards to launch its “Home’s Best Friend” campaign. A TV ad featured dogs that found homes with the help of Adopt-A-Pet.com and showed the joy they give to their owners. In the several hours preceding the show the brand was active on Facebook and Twitter promoting its involvement with Adopt-A-Pet.com, encouraging people to watch its TV commercial and replying to followers. Nearly 2,000 interactions were generated by the owned content on the day of the awards event.
Cadillac also used the Academy Awards as a launch platform for its “Dare Greatly” campaign, intended to reposition the luxury brand with younger buyers. A series of TV commercials highlighted five individuals whose remarkable achievements that helped drive the world forward. A concurrent effort in social media directed consumers to an extended version of the ad where they could learn more about each individual’s story – as well as Cadillac’s own story of driving achievement. The social campaign went live as Cadillac’s first TV spot aired and generated more than 10,000 Facebook and Twitter interactions during the awards telecast.
About Kantar Media
Kantar Media is a global leader in media intelligence, providing clients with the data they need to make informed decisions on all aspects of media measurement, monitoring and selection. Part of Kantar, the data investment management arm of WPP, Kantar Media provides the most comprehensive and accurate intelligence on media consumption, performance and value.
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