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Madison Avenue Spends $500 Million on ‘Today,’ and Could Keep Dollars Flowing

There’s less sunshine emanating from TV’s biggest morning programs, but Madison Avenue expects to continue to shower dollars on them.

Abrupt departures of two of TV’s most familiar news anchors from two of the medium’s biggest A.M. franchises have provided surreal moments at NBC’s “Today” and CBS’ “CBS This Morning.” Having Savannah Guthrie and Hoda Kotb announce Matt Lauer’s firing to the world due to allegations of harassment or watching Norah O’Donnell and Gayle King excoriate the behavior of their former colleague Charlie Rose isn’t what Madison Avenue hopes for when it dumps hundreds of millions of dollars on TV’s biggest sunrise franchises.

The networks have little choice but to act when substantial allegations surface, no matter how powerful or recognizable the person in the spotlight. Consider that in 2016, the first two hours of NBC’s “Today” took in nearly $508.8 million in ad revenue, according to Kantar. ABC’s “Good Morning America” secured approximately $401.9 million in the same year, while “CBS This Morning” captured a little more than $177 million.

Add the next two hours of “Today” to the mix, and the three morning franchises captured about $1.25 billion in 2016, according to Kantar.

“When situations like this come up a lot depends on how a show or network handles them. NBC seemed to act decisively and swiftly,” said David Campanelli, senior vice president and director of national TV at ad buyer Horizon Media. “There likely won’t be much advertiser backlash, assuming this is the end of the story.”

By terminating Rose and Lauer as the allegations swirl, the two networks no doubt hope to avoid the situation that confronted Fox News Channel earlier this year. Once a New York Times report revealed new allegations against anchor Bill O’Reilly, many of the show’s sponsors requested that their ads not appear in the program. In some of its last days, the anchor’s “O’Reilly Factor” ran with longer segments of content and just a handful of ads.

“Advertisers don’t need to feel like they are part of a program that is supporting, through some indirect way, that sort of behavior,” said one media buyer, referring to allegations leveled at Lauer and Rose.

Movie studios, makers of consumer products ranging from cold medicine to breakfast cereal, retailers, and automakers flock to the morning programs. They are typically guaranteed a live audience that isn’t skipping past the ads, said one media-buying executive, and the sunrise shows usually attract some of the younger audiences for news programming, which often lures an older crowd.

Despite the high profiles of Lauer and Rose, several ad buyers said they expected other anchors at NBC or CBS to step up and fill their seats. “These shows are franchises and based upon format and cast or family,” said one buying executive. “They all have enough of that left despite the departures of Charlie Rose and Matt Lauer to keep moving ahead.”

Advertisers have struck unique deals with each program. Toyota sponsors the “eye opener,” a 90-second video montage that has become one of the signature elements of “CBS This Morning.” A staff works overnight to cull the latest newsy moments as well as highlights from late-night monologues to help early-morning viewers get caught up on the news. At NBC, Citigroup has since 2015 sponsored a “concert series” that brings hot music acts to “Today,” some outside the show’s base at 30 Rockefeller Center in the summer. Some of those Citi-sponsored songs have been spotted on Megyn Kelly’s new “Today” hour at 9 a.m.

Madison Avenue will have to wait to see who joins the shows’ current lineups, which may provoke some hand wringing. But it can also create a new opportunity, said Ben Bogardus, an assistant professor of journalism at Quinnipiac University, who ran local news programming at several U.S. TV stations. “They are starting with a clean slate,” he said. “It’s a new beginning.”

The true test will be found in the ratings once anchor transtions are made. At present, ABC’s “Good Morning America” is the nation’s most-watched morning-news program, while NBC’s “Today” captures the most viewers between 25 and 54, the audience most coveted by sponsors for news programs. Each said can claim victory of a sort, but it’s NBC that can command the highest unit prices.

“GMA” lured an average of 4.33 million viewers last week, according to Nielsen, compared with 4.23 million for “Today and 3.69 million for “CBS This Morning.” Among the 25-to-54 demo, “Today” won an average of 1.46 million viewers, compared with nearly 1.36 million for “GMA” and a little more than 1.01 million for “CBS This Morning.”

Advetisers don’t think the daypart is flawed, said Ira Berger, who oversees media buying for Richards  Group, a Dallas ad agency. It’s the people who anchor the shows. “Personalites from all dayparts are being outed” in a new focus on sexual harassment, he said.

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