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NBCUniversal Expects More Than $1.2 Billion in Ads for Tokyo Olympics

Madison Avenue is rushing to get money down in NBCUniversal’s broadcast of the 2020 Olympics from Tokyo, the latest big TV-sports event to spark heavier demand from advertisers at a time when finding truly big media audiences has grown more difficult.

NBCUniversal said it is on track to take in more than the $1.2 billion in national advertising it secured for its 2016 broadcast of the Rio Olympics, currently the company’s record. NBCU has secured more than $1 billion in national advertising commitments for its Tokyo Olympics broadcast with eight months to go before the Games start, says Dan Lovinger, executive vice president of ad sales for NBC Sports – more than the company had negotiated with eight months to go before its 2016 event.

A good chunk of interest in the Games has come from advertisers who have never taken part in them. “More than half” of the marketers who have signed up are new, says Lovinger, noting that first-time advertisers from the technology, dining, financial-services, pharmaceutical and retail industries have bought commercial inventory. NBCU has sold packages that range in price from $1 million to $100 million or more, Lovinger says, depending on the amount of inventory involved and the scope of each advertiser’s goals.

The Comcast-backed entertainment conglomerate has been pitching the Olympics to advertisers as a sort of neutral ground that any consumer can enjoy, no matter the politics of the moment. The Democratic National Convention will take place two weeks prior to the NBCU 17-day Olympics broadcast, and the Republican National Convention will take place two weeks later. NBCU is touting its sports broadcast as something both of those segments will watch. “We believe that the Olympics will unify our country,” Lovinger says, “There is no red or blue in the Olympics, only red, white and blue. Advertisers understand and appreciate that.”

NBCU reveals the new demand for the Olympics just a few weeks after Fox Sports announced it had sold out all its commercial inventory for its February broadcast of Super Bowl LIV – the first time in about five years the network broadcasting that event has been able to do so in advance of the broadcast, rather than working until the final moments of the game. TV executives have cited a robust economy as a factor in advertisers move toward big sports events, as well as the emerging scarcity of bigger live viewership in other places of their network schedules, which have been diminished by a move of linear video viewers to streaming arenas.

Keeping advertisers interested in the Olympics is crucial for the NBCU and its parent, Comcast Corp. Comcast and NBCU are in the midst of a $4.4 billion rights deal that lets them cover the Olympics in the U.S. through 2020, and have already agreed to pay $7.75 billion for broadcast rights to the Olympic Games between 2021 and 2032. NBCU came away from its Rio coverage with approximately $250 million in profit.

If there’s an Olympics that should be attractive to sponsors, 2020 might be it. NBCU is slated to televise more than 7,000 hours of contests across many different media properties. The Games will be the first to be broadcast live across the nation, not taped for viewers in different time zones. And due to the time difference between the U.S. and Tokyo, NBCU will be able to show some of the most popular sports live in primetime,

But selling Olympics ad packages can sometimes be as tough as winning the gold medal in the event’s swimming finals. Advertisers can buy other TV commercials during the summer months for significantly lower prices, after all, and the political conventions are likely to provide some of the bigger audiences they seek.

To hook marketers, NBCU has offered some new twists. Lovinger notes many advertisers were able to get a single pricing rate, rather than have to haggle over something that might be better or worse than other sponsors received. And while many of TV’s outsized sports events are not sold on audience guarantees, NBCU for the first time has agreed to sell some ads based on the number of viewers from a particular demographic who are watching, largely on people between 18 and 49 or viewers between 25 and 54.

NBC Sports has also committed  to “spend more than half of our time on air”covering female athletes, says Lovinger, and has “created a cross-platform marketing opportunity for sponsors called “SeeHer Shine.” Megan Rapinoe, Simone Biles and Kerri Walsh Jennings are among the female athletes likely to get attention, Lovinger says.

And NBCU has sought to cut ad deals with some advertisers who might not normally try to cultivate American consumers. Ad-sales staffers have already journeyed to Japan to find some foreign marketers who might see opportunity to tout their wares to U.S. audiences. “We had a lot of fun with a local stocking company, which has committed to the Olympics and committed to a television advertisement for the first time,” Lovinger noted. “We’ve also done and anticipate doing business with some of the local tourist boards, and that should be worthy of announcement soon.”

 

More to come…

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