You will be redirected back to your article in seconds

NBCUniversal Makes Bid to Cut More Ads as Madison Ave. Grapples With Coronavirus

Linda Yaccarino, Chairman, Advertising Sales and Client Partnerships, NBCUniversal
Alex Martinez/NBCUniversal

NBCUniversal, which has for the last two years experimented with cutting back commercial time in some of its most prominent programming slots, vowed it would do more of it going forward, part of a bid to entice advertisers as many media companies grapple with the economic fallout from the coronavirus pandemic.

In a blog post released Tuesday, the company suggested it would cut commercial time in news programs on NBC, CNBC, Telemundo and MSNBC; provide longer segments on late-night programs including “The Tonight Show Starring Jimmy Fallon,” “Late Night With Seth Meyers” and “Watch What Happens Live With Andy Cohen”; and air extended episodes of reality programs on Bravo, E! and USA. NBCU could also consider airing marathons or family movie nights on its networks that will include sponsorships for limited ad interruptions.

“Given this unprecedented situation, it’s our responsibility to do more, now and always. In this case, that means accelerating plans for a better viewing experience everywhere, giving people more content,” said Linda Yaccarino, chairman of advertising sales and partnership, in a statement. NBCUniversal did not provide specific amounts of ad time that would be ceded in every instance.

One person familiar with the company suggested NBCUniversal hoped to instill some of the advertising ideas it has set up around Peacock, its soon-to-launch streaming-video service, at many of its linear TV networks. Under plans unveiled earlier this year, Peacock would stream no more than five minutes of ads per hour, and keep guard over how often a single commercial appears to a specific subscriber. NBCU has also offered new kinds of advertising formats, including single-sponsor episodes that feature just one commercial; voice-activated offers; and commercials woven into curated collections of content that hinge on a theme or genre.

Yaccarino is the latest of TV’s top ad-sales executives to start making public outreach to Madison Avenue. She faces a big challenge: the postponement of the 2020 Olympic Games from Tokyo means that over $1 billion in commercial inventory NBCU had booked previously is likely to be pushed back to next year or even canceled. A great deal of NBCU’s activity in this year’s annual “upfront” ad sales market would have been devoted to capturing ad deals for the Olympics. Some of this money could now go to rivals who will be touting sports events in the third and fourth quarters, such as a return of NBA games or some version of a Major League Baseball season.

Media companies have faced chaotic weeks of discussions with clients. Some advertisers, such as those involved in travel and retail, have asked to push ad commitments back weeks or months, or requested a cancellation of some current deals. Others, including marketers of streaming-video venues, consumer goods and some restaurants, have requested more ad inventory, according to media buyers and other executives.

But the time may be opportune to test new models, particularly as consumers forced to hunker down at home watch more of all kinds of video. “Viewership is up for the television industry. Big media companies are going to have a real spike right now in viewership that you haven’t seen in four or five years,” says Catherine Sullivan, chief investment officer at Omnicom Media Group North America, one of the nation’s largest media buying firms. “It gives the companies the opportunity to really start testing new ad formats and new ad loads. You are not going to be able to necessarily turn this into a windfall of money , but it could give them an opportunity to really start playing” with new ideas that would be of interest to an audience that has increasingly grown accustomed to binge-viewing with few ad interruptions — and sometimes none.

NBCUniversal has pressed for reductions in commercial inventory for months. In 2018, it said it would cut as much as 10% of its ad inventory around primetime originals. The company has hoped that advertisers would pay more for ads that run in an environment that contains less of them. Some ad buyers have complained publicly that NBCU did not go as far as they had hoped in executing the policy.

In recent months, some more experiments have been on display. During intense moments of stock-market volatility, CNBC has gone without commercial breaks, instead running bottom-of-the-screen banners from TD Ameritrade telling viewers that the online-trading service was the sponsor of the commercial-free coverage. On Friday night, a broadcast of “NBC Nightly News” contained a commercial break known as a “squeezeback” during which the ads were framed by messages ticking down the seconds until Lester Holt returned.

NBCU indicated that overall TV usage has increased by 25% among people between 18 and 49 since social distancing measures were made more stringent in the U.S., while total consumption at NBCU properties has risen overall by 27% since March 16.