Is There Such a Thing as Too Much NFL?

Additional Inventory and Auto Pullback May Have Impacted NFL Marketplace

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The NFL is TV's powerhouse, but marketers are being asked to pay up for additional big audiences on broadcast prime-time now that CBS has games Thursday nights.
The NFL is TV's powerhouse, but marketers are being asked to pay up for additional big audiences on broadcast prime-time now that CBS has games Thursday nights. Credit: NFL/Aaron M. Sprecher

Not even the NFL may be immune to the weakness that penetrated the ad sales market during this year's upfront negotiations for the new TV season.

The strength of the market for NFL ad time seems to be up for debate. Sellers said demand continued to be robust, but buyers argued that increased supply and some pullback from key advertisers created some cracks -- albeit ever so slight.

"There's less sold at this point than the same time last year," said Neil Vendetti, exec VP-national video activation, Zenith.

"Overall, the NFL marketplace was healthy and the demand was there, but the market was not as strong as in the past few upfronts," echoed Kevin Collins, senior VP-sports investment, Magna Global. But some individual sellers such as NBC have shown some strength, he added.

NBC is nearly 90% sold out of "Sunday Night Football," according to Seth Winter, exec VP-sales and marketing, NBC Sports Group. NBC is on track to strike early deals for 7% more volume in NFL programming than a year earlier, he said, with price hikes in the high single-digit percentages. Pricing for 30 seconds of commercial time during the network's "Sunday Night Football" is approaching the mid-to-high $600,000 range, he said.

"We are very pleased with what we are seeing so far," Mr. Winter said.

NBC's Thanksgiving evening game, this year between San Francisco 49ers and Seattle Seahawks, is also virtually sold out, he added.

NBC has additional leverage this time around because it will air the Super Bowl next year. NBC is reportedly seeking about $4.5 million for a 30-second Super Bowl ad, and buyers say the network is asking advertisers to spend more money in other properties to get time in the big game.

While Mr. Winter declined to say how much Super Bowl inventory remains, Mr. Collins estimated that there are about 12 to 15 spots left.

Other networks also said the NFL market hasn't faltered.

ESPN's Ed Erhardt, president of global custom marketing and sales, said the cable network is ahead of last year, with college football helping to set the pace for NFL. ESPN has achieved increases in both pricing and volume, he said, declining to provide specifics.

CBS's Sunday games are also selling quicker than last year, said John Bogusz, exec VP-sports sales and marketing, CBS Sports.

The network's acquisition of eight "Thursday Night Football" games may have given the market pause, at least early in negotiations, as everyone waited to see how CBS would price the new inventory and what kind of audience guarantees it would offer.

Sellers said the impact was minimal because NFL Network had already been airing games on Thursdays. "It hasn't impacted demand in the marketplace and hasn't created a problem of too much supply," Mr. Winter said.

While there may not be more ad time in the marketplace, however, there are certainly more ratings points available.

"CBS added a significant amount of additional ratings points," Mr. Vendetti said. "It was probably not the best year for these ratings points to be infused into the market due to the weak upfront overall. There are not additional dollars to support it."

But it remains unclear exactly how many additional viewers will tune in, and whether that affects viewing on other networks.

CBS is seeking more than $500,000 for a 30-second spot in "Thursday Night Football" and setting guarantees on a 12.3 household rating, Mr. Bogusz said. (One ratings point is the equivalent of 1% of TV households.) That household rating will be the combined viewership of simulcasts on both CBS and NFL Network.

Some buyers said these guarantees may be a stretch.

"CBS has been aggressive on estimates," said Tim Hill, senior VP-group partner, integrated investment, UM. "They maybe a little high, but NFL has surprised us before. They are not unattainable, but a reach."

"Just because more NFL supply was added to the marketplace, it doesn't necessarily mean there is more volume in the marketplace for all the broadcast partners," Mr. Collins said.

Mr. Bogusz said there is still "Thursday Night Football" inventory available, but CBS is "where we expected to be."

The biggest hiccup for NFL ad sales has been the auto category, as some major automakers are believed to have reduced or consolidated their presence in the NFL, according to both buyers and sellers.

But Mr. Winter said NBC is essentially sold out in autos. "Where one auto maker may have left, another one has come to fill the breach," he said.

Despite any possible softness, NFL games continue to be some of the most sought-after TV programming because of the huge live audiences they draw in an increasingly DVR and on-demand era.

"NFL still commands top of market pricing increases. It is still uniquely positioned as event programming," Mr. Vendetti said.

Just look at the numbers. NBC's "Sunday Night Football" and other regular-season telecasts averaged 21.8 million viewers last year. Fox's regular season was watched by 21.1 million on average, CBS's regular season averaged 18.6 million and ESPN's "Monday Night Football" averaged 13.7 million.

"Live sports are the ultimate custom experience for marketers brands," Mr. Collins said. "As video consumption becomes increasingly on demand, there is unquestionably value in live sporting events that get people in front of the set as well as commenting in real time on social networks."

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