- Following sports cancellations earlier in the year, advertisers will once again have to figure out how to manage existing TV advertising commitments.
- And solutions range from pulling funding entirely, to keeping commitments with the same media company but shifting to other professional sports programming.
- Insider Intelligence analyzes this industry and several others to provide in-depth analyst reports, proprietary forecasts, customizable charts, and more. Learn more about what we offer.
This week two of the NCAA Division I Power Five conferences (Big Ten and Pac-12) announced that they would postpone all fall college sports as a result of the ongoing pandemic.
The move puts pressure on the other three to follow suit, and it could send sports advertising budgets into freefall. Last season, college football alone captured an estimated $1.7 billion in national and spot TV ad revenues, according to Kantar Media.
Following sports cancellations earlier in the year, advertisers will once again have to figure out how to manage existing TV advertising commitments. Based on Advertiser Perceptions data published in July, we believe three scenarios are most likely:
- Pulling commitments completely without reallocation. Some 38% of advertisers indicated that they would pull sports ad spending without reallocation, according to an Advertiser Perceptions survey in June. This was the most common response in the survey, and we think this tactic will occur at a much higher frequency this time. While the duration of the pandemic is still uncertain, it has become abundantly clear that there isn't a quick fix. We think that organizations will most likely cut commitments to prepare for an ongoing period of economic uncertainty.
- Keep commitments with the same media company and wait for the spring season to run campaigns. According to the same Advertiser Perception survey, 36% planned to maintain their commitments and wait for sports programming to arrive later in the year. This sentiment, though now outdated, suggests that a sizable segment of advertisers may keep pre-existing advertising commitments—although this may create additional complications in the spring. Assuming other sports like basketball and baseball stick to traditional schedules, a college football season in the spring may find itself competing with other leagues for viewership.
- Advertisers could keep their commitments with the same media company but shift to other professional sports programming, including the NFL, NBA, and MLB. Other professional sports leagues (NBA and MLB) have resumed their seasons in a fairly limited capacity and without fans. But this has not stopped advertisers and fans from coming back; regional sports networks saw a 31% increase in viewership year over year during MLB opening weekend, according to Nielsen. Some advertisers may want to commit as much spending as possible to the sports that are available, providing a potential boost to professional leagues.
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