Wednesday, August 20, 2008

Has the NBC Peacock Lost it's Mind?

Okay, you invest a few hundred million bucks in staging the Olympics expecting to make a fortune in ad revenue and how does it go? Well this Olympics is rather unusual because of Michael Phelps and the USA women's gymnastics team. Remember that Americans love the Americans in the Olympics.

According to TV Week NBC continues to reap the benefit of the Phelps effect, adding another $15 million to its already impressive Olympics ad sales total.

The network said Tuesday that it sold the extra ad inventory within the last week. Add in $10 million it sold in the first couple days of the Games, and NBC has increased its Olympic ad revenue haul by $25 million since the Games began. Overall, NBC has billed more than $1 billion to advertisers for the privilege of hawking their wares during the Olympiad.

Seth Winter, NBC’s senior VP of sports sales and marketing, said retail, packaged goods, movies and pharmaceuticals were among the categories driving the recent ad sales. More than 100 companies have bought time on the Games, as have both presumptive U.S. presidential nominees.

While NBC doesn’t seem to be having any trouble convincing advertisers to get on board the Beijing bandwagon, the network nonetheless touted a new Nielsen IAG study detailing the value of Olympics advertising.

The study said brand recall for Olympics ads was 130% higher than other prime-time shows, and that message recall was more than twice as high. Also, viewers were three times more likely to positively respond to an ad screened during the Olympics, compared with those seen in regular prime-time shows.

NBC said that more than 196 million viewers have watched the 2008 Olympics on the various NBC Universal networks during the first 10 days of the Games. That’s 11 million more than watched the first 10 days of the Athens Olympics.

From TV By the Numbers comes the following:
Tuesday, August 19

Though down a fair clip from last week’s average of 32 million, the Olympics still compelled over 25 million people to watch. Since even NBC had predicted this week wouldn’t be as large as last, I imagine they are pretty tickled with these numbers. It will be interesting to see if NBC can break the total reach record of 209 million set in 1996 with the Atlanta games. Through Monday’s broadcast (but not including yesterday) NBC was at 200 million after 11 days and still adding ~5 million total viewers per day.

I don’t know if it’s possible for the networks to figure out, but there’s something about the Olympics that draws in the more youthful demos and it’s performed very impressively among 18-34 year olds. NBC had a 20% share of all 18-34 year olds watching TV for the night. The other broadcast networks combined (including Spanish language and ION, but not MyNetworkTV) combined for 18% share among 18-34 year olds.

So even with the Olympic-sized success of NBC, the broadcast networks combined for only ~38% of all 18-34 year olds. 62% were watching cable or local programming. The same thing is basically true for the 18-49 demographic as well.

What in the world is wrong with all that news? Record ad revenue and record viewers sounds like a good deal. But there are some things missing, like figuring out where in the world to find the events on the tube. NBC has spread the broadcast over all the following networks.


That means you have to look in 12 different places to find what you want. The daily schedule does not tell you if you are watching last night's reruns or new events. Even when you are watching them it does not tell you if they are earlier results.

As if that is not bad enough the primary network broadcast, NBC, wasted two prime hours over the weekend showing a live broadcast of the women's marathon in which no women were contenders when there were basketball, baseball and volley ball matches with American teams doing quite well.

The NBC policy of waiting until the last hour or two of the evening network broadcast to show the premier events means Michael Phelps or the women's gymnastic team is performing nearly at midnight on the east coast, long after many kids have gone to sleep.

Also missing are profiles of non-American athletes which were highlights of earlier games so the fans could get to know some of the top foreign competitors. We have no clue who the top world performers might be in many sports since NBC is not running profiles.

If they set records this year, and I do expect a major drop off in viewers now that Phelps and the women's gymnastic team is off television, the records will be far below what they could have been if the NBC production had been geared to the viewers as well as the advertisers. On the good side, some of the best ads on TV have appeared during the Olympics.

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