Editor’s Note: Last week we covered NBC’s approach to reducing commercial clutter and their creating new ad formats.
AdAge comments on the consequences if Fox reduced ad loads to two minutes per hour in the next two years—it would have to make up the lost ad revenue somehow. Fox today sells much more commercial time—10.6 minutes per primetime hour in January, for example, according to Pivotal Research Group. At that estimated upfront price of $300,000 for a spot in “Empire,” 10.6 ad minutes would mean $6.4 million for Fox.
To match the revenue in a world with only two minutes of commercials, Fox would have to more than quintuple its price. That’s not going to happen. More realistically, it would have to pin its hopes on a dramatic and ambitious evolution in the TV ad model, replacing traditional spots with a robust package of new formats, targeting and brand integrations that often demand extra effort from advertisers. The near term will likely see movement on all these fronts: new tactics and technology combined with higher prices to achieve a reduced ad load.
Contrary to some headlines that followed the summit, Marchese didn’t exactly promise two minutes by 2020. Marchese asked the audience of rival TV executives, media buyers and marketers what it would take to bring commercial loads on broadcast TV down to that level. With traditional TV ratings in long-term decline and ad-free options on the rise, it’s a question worth asking, but a tough one to answer.
It seems like marketers would get more value from advertising in shows with less commercial clutter, giving their spots a greater chance to be seen and remembered, but there’s no real data to prove it, much less quantify it. So neither Fox nor any other TV network expects marketers to simply sign off on price increases for the same units and strategy they buy now.
What they are looking to do is to find ad formats and strategies beyond the traditional 15-, 30- and 60-second spots, approaches that would help marketers’ messages work harder. Fox and others are already experimenting with six-second ads that can land a punch quickly, before viewers change the channel or find the fast-forward button. AMC has been running six-second ads just before new episodes of “The Walking Dead,” and NBC used them during the Winter Olympics in Pyeongchang.
Or Pepsi’s 2015 meta integration with “Empire,” where the beverage giant was featured prominently in the show and culminated with a music video that ran in a commercial pod starring a character from the show. But these types of integrations are complex, costly and timely, and can’t be done for every episode of every show.
Even more ambitious goals include interactive TV ads and expanding the addressable advertising now available through cable and satellite providers. They’re all plausible scenarios. But given how slowly TV has moved in the last decade, two years seems an awfully short time to see that much drastic change to the TV ad model.