Compelled Pledge of Allegiance to the Government/National Anthem/Kaepernick Controversy Having No Impact on NFL TV Ad Revenues
/From [HERE] For much of the past decade, the NFL TV ad market was a bit like the housing bubble of the aughts. Each year, those companies with football rights could count on hefty double-digit increases in returns each year, while using the NFL’s robust ratings increases each year to leverage their network’s weaker-performing sports at the time, like baseball. “While your subconscious will tell you this can’t last forever, many of those who enjoyed the benefits of that housing craze and were flipping homes and taking profits never thought the party was going to end,” says Mark Evans, svp of advertising sales for Fox Sports. “So when the ratings did plateau and then decline somewhat over the last year and a half, everybody in town was like, wait a minute, this isn’t supposed to happen!”
While NFL TV advertising has never cratered like the real estate market did, it was hit with plenty of upheaval last season. The second straight year of ratings declines (regular season NFL games averaged 14.9 million viewers, according to Nielsen’s live-plus-same-day ratings, a 10 percent drop from 2016’s 16.5 million audience) came hand in hand with the growing controversy over player protests during the national anthem, stoked by President Trump himself. Midseason, some anxious advertisers even threatened to pull their NFL ads if in-game protest coverage continued—though none actually followed through. The ratings drops resulted in a higher number of makegoods, which ate into inventory and led to the unthinkable: a year-over-year decline in TV NFL ad revenue for NBC, CBS, Fox and ESPN, from $2.45 billion during the 2016-17 regular season to $2.42 billion last year, according to Standard Media Index. Including the playoffs and Super Bowl, ad revenue fell 3.9 percent year over year, dropping from $3.56 billion to $3.42 billion.
But as a new NFL season gets underway, a surprising thing has happened during this year’s upfront and scatter markets. Despite last year’s controversy and uncertainty, advertising demand for NFL games is as strong as ever. For NBC’s Sunday Night Football, “we booked more than we planned, and at a higher rate of change than we planned, says Dan Lovinger, evp of advertising sales, NBC Sports. “There were no negative impacts as far as we could tell.” CBS is also “in really good shape” and doing “slightly better” than last year with its Sunday afternoon package, says Jo Ann Ross, president and chief advertising revenue officer, CBS Corp. (Sales for the Super Bowl, which CBS will air in February, are also on par with the last time the network broadcast the game three seasons ago.) With similar reports from the other networks, look for the average 30-second spot during regular season games—which was $505,000 in 2017, according to Standard Media Index—to go even higher this year.
This comes even as the national anthem/protest controversy lingers this season. Case in point: Nike’s two-minute “Crazy Dream” spot—which aired during the season’s kickoff game last Thursday—featuring former NFL quarterback Colin Kaepernick, who sparked controversy by sitting, then kneeling during the national anthem to protest racism and police brutality. (Kaepernick is now suing the league, accusing the NFL of colluding to keep him off the field.) NFL owners temporarily instituted a new policy in May, which is now being reviewed and possibly reworked, that would fine protesting players, and Trump continues to revisit the hot-button issue (“As far as the NFL is concerned, I just find it hard to watch, and always will, until they stand for the FLAG!!” he tweeted last Wednesday).
However, TV ad sales execs and buyers alike say that the controversy doesn’t seem to be an ongoing concern during negotiations, aside from some clients keeping their distance from inventory early in the first quarter, and no advertisers have pulled out of football as a result of that. On the contrary, more brands are gravitating toward the NFL, which still boasts some of TV’s largest audiences as ratings fall across all of linear television. Sunday Night Football remained the No. 1 broadcast prime-time program last season among adults 18-49, with a 6.2 rating in the demo, while Fox’s Sunday afternoon America’s Game of the Week package was again the most-watched show last season, averaging 22.7 million viewers.