The Week In Review: March Madness Digital Viewership Dips, Ad Dollars Don’t

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April 9, 2012 – 12:09 am

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On March Madness Viewers, Ads

The TV Everywhere concept is intended to protect the existing system of broadcast retransmission and licensing fees. But not much has been said about the impact on advertising and that's because most TV Everywhere experiences - where authenticated cable subscribers get to watch cable programming on their PCs, smartphones and tablets - remain in the nascent and experimental phase.

Turner's placement of its broadcasts of this year's March Madness college basketball tournament behind a TV Everywhere paywall could offer a clear look at what this system means to the viewership and ad spend for networks as they prepare to more fully navigate the world of live streaming video. After all, most TV industry observers acknowledge that one reason subscribers won't cut their cable cord in favor of over-the-top services is that they can't get live sports through any other vehicle.

While Turner hasn't talked about how well it's done in terms of its ad revenue, the digital viewership numbers declined predictably due to the introduction of the TV Everywhere and paywall. As the Turner, and its March Madness partner CBS Sports announced back in Februrary, digital viewers would either have to prove they're "authenticated" subscribers or pay $3.99 to watch all 67 games.

In terms of the digital viewership, Multichannel News' Todd Spangler has the details from Turner: traffic to NCAA.com and March Madness Live broadband and mobile services slipped 6 percent year-over-year with 51.6 million visits between March 11 to April 2. During that period, the digital extensions attracted about 1.1 million daily uniques, which represented a drop of 10 percent.

That's not to say that the digital extensions were not popular. The NCAA March Madness Live was the top app in the sports category for most of the tournament.

The slight dips in digital traffic appeared to have no impact on Turner's ad dollars, both on the TV and interactive sides. As Kantar Media noted last year, between 2001-2010), national TV advertising during the men's tournament has translated into over $4.8 billion of spending from more than 280 different marketers. Ad revenue in 2010 was $613.8 million, up 4.3 percent from the prior year but still below the all-time high achieved in 2008. Given that trend, the feeling was that Turner and CBS would need to rely more on incremental digital ad dollars.

According to AdAge's Jason Del Rey, digital advertising delivered $60 million -- a small chunk compared to TV, but more than double what PC and smartphone viewing did in 2009. A sign of progress, albeit a small one. (Incidentally, that $60 million excludes the $3.99 paywall dollars.)

In balancing out what to charge advertisers for offline content when it goes online, the prevailing thinking has been to drive greater scarcity – you can't watch these live broadcasts on YouTube, right? – and promising "engagement." Certainly, if someone is going through the chore of creating a TV Everywhere account or paying $3.99 separately, they're probably going to be pretty engaged.

Still, the screen experience on PCs, smartphones and tablets still aren't as great as HD televisions. But that's one drawback. People are getting more used to watching on personal devices. And if networks can get enough viewers used to paying up – and paying attention once they do – that might warrant the kinds of CPMs advertisers have been used to coughing up for broadcasts. Still, the $60 million ad take for the digital extensions is pretty paltry, suggesting that there remains a long way to go for sellers to convince buyers that digital is just as valuable as traditional broadcast.

Discovery Upfront, Pressure On OWN

Discovery Communications kicked off the upfront season with several new series, a few big specials and one major rebranding of a network. But much of the attention was focused on how soon Oprah Winfrey's OWN, a joint venture between the daytime talk diva and Discovery, would correct its current rocky course.

The upfront season is almost like New Year's for buyers and sellers. It's point of demarcation for both and a chance a to reflect on the past year, while making pledges for the current one. For the most part, Discovery has been pretty successful in convincing advertisers to spend not just on its "140 worldwide television networks," including its flagship Discovery Channel, TLC, Animal Planet, Science and Investigation Discovery, as well as its other U.S. joint venture networks The Hub and 3net, the first 24-hour 3D network.

Variety's Jill Goldsmith has the full rundown on the company's upfront slate, which includes plans to rebrand its Planet Green channel as Destination America.

It's also plotted an unconventional course with non-TV related sites like HowStuffWorks and putting its 20-year-plus-old library to work by selling episodes on iTunes and, more recently, striking a major streaming deal with Amazon for the latter's subscription online video service.

The cable networks and the digital extensions tend to reinforce each other. The "feel-good news" focus on OWN have not been able to charm advertisers or viewers to a great extent. The turnaround is difficult, though OWN would seem to have enough social media heft to help it begin to turn the tide.

So far, some of the early big sponsors say they'll stick around OWN and Discovery executives have insisted they'll support the network, Reuters' Lisa Richwine and Ronald Grover report in a long piece about the network's position. For the most part, a lot of the big successes in cable the past few years have tapped into viewers' more negative impulses – can MTV's waning hit Jersey Shore or any of Bravo's Real Housewives series be about anything other than viewers' schadenfreud?

Can the "aspirational" OWN plunge into the muck of reality TV or can it continue to hope to appeal to advertisers' and viewers' "better angels." It's hard to imagine the sunny optimism of OWN, which so deeply embodies those same hopeful qualities as Oprah herself, delving into Jersey Shore-like territory. But with so much pressure on, that place may be the only direction OWN can go in.

What's On That 'Second Screen?'

TV networks and advertisers have been trying to crack the "second screen" for years. But as more people use smartphones and tablets, there is a feeling among analysts and media companies that we're getting close.

While a Nielsen survey seems to bear out the obvious that viewers are indeed doing a great deal of simultaneous TV watching and digital device using, advertisers and networks may be a disappointed by what consumers are actually doing. For the most part, they're not tweeting or checking Facebook so much. They're checking email.

Still, Nielsen did try to inject some hope for media companies. "Yet device owners also seem to engage with content related to the TV as well, either by looking up information related to the show or looking for deals and general information on products advertised on TV."

Unfortunately, Nielsen didn't provide specific numbers for this, but it does throw some cold water on the notion that consumers are largely looking for reinforcing content or ad messages that relate to what they're watching on TV. Still, it could be suggest other opportunities for advertisers who are looking to counter a major media event. For example, maybe during a sports playoff series that has galvanized male TV viewers, this might be a good time to focus on perfume ads for women instead of trying out another would-be viral Old Spice campaign.

But Wait. There's More!

By David Kaplan


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April 9, 2012 – 12:09 am
  1. One Response to “The Week In Review: March Madness Digital Viewership Dips, Ad Dollars Don’t”

  2. Has Turner released any info regarding how many viewers paid the $3.99 fee to access the game via the March Madness app? That would be very interesting to know, as I envision more live-streamed sporting events will be charging rather than provide free-to-viewer access going forward. MLB.TV is already doing this now -- fairly successfully -- and the MLS recently launched a similar subscription-based program for their live-streaming effort (MLS Live).

    [Reply]

    By Jay on Apr 9, 2012

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