Nearly six months before Quibi is slated to hit the market, a cluster of large advertisers has committed millions in ad spending to the ambitious — and untested — premium mobile-video brainchild of Jeffrey Katzenberg.
Quibi announced that it has sold out its $150 million advertising inventory for the first year. The startup’s category-exclusive ad partners for the April 2020 launch include Discover, General Mills, T-Mobile and Taco Bell. Earlier this year, Quibi said it booked $100 million in upfront commitments from six advertisers: Procter & Gamble, PepsiCo, ABInBev, Walmart, Progressive and Google.
Hollywood movie studios, most of which have invested in Quibi, also are expected to run advertising on the service.
What does it prove that Quibi has secured healthy ad commitments before anyone has seen the actual service? Mainly, it seems to show buy-in from some on Madison Avenue to the story Katzenberg and CEO Meg Whitman have told about how their “quick bites” service will create a new category of short-form entertainment targeted at an audience band of 25-to-35-year-olds.
“We are seeing a tremendous response from advertising partners who recognize the value of Quibi’s premium, brand-safe, mobile platform that is focused on the highly coveted millennial audience,” Whitman said in a prepared statement.
There’s also a common sentiment among those in the industry that, well, if Katzenberg is behind this, odds are it will work — and, if it doesn’t, it won’t be a major gamble. Quibi has landed investors on the back of Katzenberg’s pedigree, having raised $1 billion in funding from backers including Disney, NBCUniversal, WarnerMedia, Viacom, Sony and Alibaba Group.
True, Quibi has spent millions to line up big-name Hollywood talent for original scripted and unscripted shows, like Steven Spielberg, Guillermo del Toro and Catherine Hardwicke, to name just a few. But it’s ultimately unclear how many people will sign up for the service, with monthly pricing to be $5 with ads and $8 for an ad-free tier — especially as Quibi comes to market amid a spate of new streaming offerings.
If Quibi fails to deliver on audience guarantees made to upfront advertisers, it will provide make-goods, Whitman has previously said. It isn’t known what promises Quibi has made in terms of audience reach.
Meanwhile, the fact T-Mobile is in the mix as an advertiser isn’t surprising: Quibi announced T-Mobile as its exclusive wireless launch partner, although the companies haven’t said what that means in the way of perks or price breaks for T-Mobile customers.
Quibi says it will deliver advertisers a “uniquely uncluttered” environment with a single, non-skippable preroll ad (running six, 10 or 15 seconds) before episodic content. The company also expects to experiment with “a number of other innovative ad formats” but hasn’t publicly detailed what those might look like.