Bad News for Oscars -- and Advertisers?

Nominees' Low Box-Office Haul Could Mean Another Year of Low Ratings for Telecast

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NEW YORK (AdAge.com) -- The latest Academy Award winners won't be known until Sunday night, but already the losers are clear: Oscar himself, and most likely that the brands that paid to be in his midst.

The 2009 Academy Awards can, sadly, again be reasonably predicted to be among the lowest-rated Academy Awards telecasts on record.

Why? Blame Opie.

When Ron Howard's critically beloved but box-office-anemic "Frost/Nixon," which has a current domestic box-office haul of barely $17 million, received a best-picture nomination by edging out the second-highest-grossing film of all time, "The Dark Knight," this year's Oscar telecast's fate was sealed, many experts say.

Best-picture nominees at the box office
Consider: In the years when nominated films' grosses are high, the telecast's ratings get a commensurate boost. When "Titanic" edged out popular pictures such as "As Good As It Gets," "Good Will Hunting," "L.A. Confidential" and "The Full Monty," the five best-picture nominees enjoyed a combined $996 million box-office haul in the U.S. alone. The result: More than 57.25 million viewers tuned to the 1998 Oscar telecast.

By comparison, in 2008, the combined best-picture Oscar nominees -- "There Will Be Blood," "No Country for Old Men," "Juno," "Michael Clayton" and "Atonement" -- managed only $356 million in domestic grosses. The result: the lowest Oscar ratings on record, with only 31.76 million viewers on average -- almost half of 1998's ratings.

This year's best-picture Oscar nominees are especially weak at the box office: Odds-on favorite "Slumdog Millionaire" has made only $89 million; "Milk" has grossed just $26 million so far; and "The Reader," $20 million. Only "The Curious Case of Benjamin Button" broke out, raking in $122 million at home. Combined domestic gross, including "Frost/Nixon's" $17 million: just shy of $275 million.

While no one can be certain how low Oscar's ratings might go on Sunday, but as one media-buying-agency executive put it, nominee "Kate Winslet as an illiterate pedophile Nazi war criminal? Come on, already: Put a fork in it -- it's done."

Bargain hunters
Indeed, many top brands stayed away from the telecast this year, but others are bargain-hunting.

  • Hyundai Motor America jumped into General Motors' old spot, with eight total ads airing during the ABC telecast.

  • Coca-Cola will run seven ads in the Oscars, according to spokeswoman Susan Stribling. While the focus will largely be on Diet Coke -- one ad will even revive the old slogan "Just for the taste of it" -- the company will also run three ads touting Coca-Cola and urging viewers to do positive things such as recycling. Publicis Groupe's Leo Burnett crafted two of the Coke ads, while independent Wieden & Kennedy did the rest, including the Diet Coke work.

  • L'Oreal, a five-year sponsor, bailed out, a spokesman said, because although Oscar "had been a very successful property for us ... last fall we decided to explore new avenues for reaching our consumer."

Fear of record-low Nielsen ratings, of course, may be only part of the story.

"I don't think the movies have anything to do with L'Oreal leaving this year," said one Hollywood talent-agency branding agent who declined to be named. "The economy turned to poo-poo, and everyone had to cut," the agent added.

The branding agent also cautioned that low-grossing films aren't necessarily the bane of viewers or advertisers.

"I would argue the reverse," the agent said. "People aren't going out as much. As long as there are those stars on the red carpet, and you've got an underdog story [in 'Slumdog Millionaire'], I think people will watch on a cold Sunday night. And for brands, you're selling a lifestyle instead of a quantity."

Why one advertiser's still buying
Craig Culver, CEO and co-founder of Culver Franchising System, a Prairie du Sac, Wisc.-based quick-service restaurant, agreed. He has purchased a 60-second spot on E!'s Oscar pre-show and a 30-second spot in the ABC telecast.

"I guess [it's] the second phase to our marketing program -- the Culverization of the world," Mr. Culver said laughing.

His 395 Culver's restaurants are in only 17 states. Yet competitor Sonic Corp., the nation's largest chain of drive-in restaurants, has been advertising on national cable since 2004 and reaching into markets hundreds of miles from the nearest Sonic franchise.

"This is 100% for our operators, some of whom are a little isolated," Mr. Culver said. "We have just one restaurant in Cheyenne, Wyo. We've got just nine restaurants in the state of Texas. We see it as an opportunity to grow our business."

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Brian Steinberg and Jean Halliday contributed to this report.

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