NBCU Expects More Than $1 Billion In Advertising for 2016 Rio Olympics

Rio Olympics
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For advertisers, the Olympics and the Super Bowl have a lot in common: They both cost a fortune, demand commercials that make a splash and bring in some of TV’s biggest audiences. But Madison Avenue seems to have a more favorable view of the global Games than it does the Big Game.

With a year to go before the opening ceremonies for the 2016 Summer Olympics, NBCUniversal believes it will sell well over $1 billion in advertising for its telecast, slated to take place in Rio de Janeiro, Brazil.  Sales are projected to be greater than what NBCU took in for its 2012 Summer Olympics from London, when the company also took in about $1.3 billion, according to data from Kantar Media – a new record compared with the $850 million NBCU captured for its 2008 coverage from Beijing. Compare that with the company’s efforts to sell ads for Super Bowl XLIX earlier this year, when executives ran into strong headwinds.

“We’ll deliver an NFL-like number every evening, exceeding 20 million viewers,” said Seth Winter, executive vice president of ad sales for NBC Sports, in a talk earlier this week with reporters.  He added: “I think our expectations are that we’ll exceed London.”

Winter’s words, brushed with descriptions of a recent trip he made to Rio’s rainforests, lacked the chillier tones he used in January to describe the process he faced in trying to sell the Super Bowl. “This was not the easiest exercise I’ve been through,” he said then, a reference to diminished interest in the gridiron classic evidenced by auto advertisers, who have made up a large part of the game’s ad roster in past years.

The Super Bowl, Winter said this week, is “such a unique property in that it takes so much more investment in creative. It’s a hit or miss, and the stakes are exceedingly high in the Super Bowl.” Expectations for Olympics ads may not be as high as they are for the Super Bowl, where advertisers have just one chance to win over the crowd. During an Olympics, sponsors generally run ads multiple times.

Automotive marketers are pushing forward for Rio, Winter said, along with manufacturers of packaged goods, insurance marketers, movie studios, and fast-food restaurants. What’s more, NBCU has seen “good commitments,” he said, from Olympic sponsors including BMW, United Airlines, Procter & Gamble, Kellogg’s, Nike, and Coca-Cola. U.S. Olympic sponsors have the rights to use Olympics trademarks in their ad campaigns, but they are not required to buy time on the TV networks showing the events.

NBCUniversal has some new angles to tout for its 2016 extravaganza. There is only a one-hour time difference between Rio and New York, meaning the company can broadcast much more of its Olympics content live. In past efforts from Sochi or Beijing, NBCU has had to rely on taped packages for some of its primetime programming, raising worries over whether people who would watch live via digital streaming would turn up again for the TV showcase.

Because the 2016 Games will feature Golf, NBCUniversal can broaden programming on its Golf Channel. “We will have more capacity” because of the sport’s presence, said Winter.

Digital ad sales are also moving well, Winter said, though he suggested NBC does not have enough capacity to meet demand for ads to accompany streaming-video coverage. “There is probably a 10 to 1 ratio of what I’ll call linear capacity to digital capacity,” he said, “and we just don’t have enough to satisfy everyone’s desires for that.”