The world of advertising strongly relies on events, sports, movies and television to stay alive. Ads are sold in all verticals to assure brands that their product will be seen by millions of people. Large sporting events like the Olympics or World Cup bring in hundreds of millions of dollars worth of advertising to the television networks airing the program. These ads are sold over a year in advance in preparation for the biggest event of the year. With the 2020 Olympics around the corner, companies started purchasing their ad space with NBC well over a year ago. NBC, the exclusive broadcaster for the Olympics, sold over $1.25 billion in ads for the summer Olympics. Due to the COVID-19 outbreak and stay at home measures in place, this worldwide event had to be cancelled, so what happens to all that money?
The television and cinema industries are greatly suffering from measures taken by the government during this time. People cannot leave their homes, travel, or go to work – therefore, sports, filming and all events are on pause. This poses a major threat to the advertising industry as they cannot sell ads, existing or new, since there is no viewership. Movie theaters are closed and television show releases and sporting events are cancelled. Do salespeople cancel deals, give money back, pause or postpone? Can companies on either end of this equation afford any of these “solutions?”
These industries are trying to keep themselves afloat by moving around the already booked dollars and pushing the inventory to air later in the year. As someone who works in the theater ad space, I know how challenging this can be. Companies are working with their clients to pause and shift dollars rather than cancelling their deals all together.
Will this pandemic lead to the long awaited rise in digital marketing? Since people cannot leave their houses and don’t have much live television or movies to watch, what are they doing? They are online. The digital world has been growing and evolving for years and everyone is involved with it in some way. Yet the world of digital advertising is still far behind broadcast and out of home. Based on research I have done at work, digital advertising is always third in line to broadcast and out of home for almost all companies. It seems as though being the new kid on the block, digital is still working its way up the advertising ladder. Why are people so hesitant to pay money to advertise on a platform that the entire world is accessing regardless of where they live?
Although this is a difficult time in all our lives, advertising sales executives have a great opportunity to prove the worth of their digital products. This is the perfect time for them to sell digital advertising and reallocate client dollars into digital and mobile platforms because it is not being affected by closures and social distancing. Since TV shows, sporting events and movies are being delayed it seems online is all that is left – can these companies leverage the growth of digital and keep their advertising and ad spend alive?
References:
Dockterman, E. (2020). Streaming was already up 13% last weekend. Can movie theaters survive COVID-19? Retrieved from: https://time.com/5806060/coronavirus-movie-theaters-streaming/
Goldsmith, J. (2020). NBCUniversal “actively working” with advertisers on Olympics’ delay with $1.25B in ad sales at risk. Retrieved from: https://deadline.com/2020/03/nbcuniversal-advertisers-olympics-delay-coronavirus-1202890926
McAteer, O. (2020). Cinemas among first major victims of COVID-19 as advertisers pull media. Retrieved from: https://www.campaignlive.com/article/cinemas-among-first-major-victims-covid-19-advertisers-pull-media/1677558
Zaffaris, J. (2020). Adweek’s guide to COVID-19 coverage: How the advertising and marketing world is forging ahead. Retrieved from: https://www.adweek.com/brand-marketing/adweeks-guide-to-covid-19-coverage-how-the-advertising-and-marketing-world-is-forging-ahead/
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