TV ad prices rebound for Academy Awards show
After two years of no rate increases for Academy Awards telecast spots, prices have rebounded sharply for this month’s upcoming show, with ABC fetching prices at near-record rates.
The network is charging about $1.7 million per 30-second spot — a haul that could help the network achieve revenue of more than $80 million for Hollywood’s biggest night of the year, according to advertising insiders.
ABC said Thursday that it had sold out its available inventory in the glittery Feb. 27 event.
Total revenue for last year’s telecast was $70 million, according to Jon Swallen, senior vice president for research at Kantar Media, which tracks advertising spending. ABC collected about $1.3 million to $1.5 million per spot in 2009 and 2010.
If the award show pulls in $80 million this year, it would be a huge relief to the Academy of Motion Picture Arts and Sciences, which relies heavily on the television money to finance its annual operations and stage the Academy Awards.
Last year’s strong ratings for the Oscar telecast helped to fuel ad sales this year. An average of 41.7 million people viewed the program in 2010, producing Oscar’s largest audience in five years.
Advertisers including JC Penney, AT&T, Coke, Sprint, Procter & Gamble, Hyundai, Nokia, Amazon.com, Anheuser-Busch, McDonald’s and Best Buy have bought spots in this year’s telecast, according to ABC.
“They ordinarily don’t have trouble selling this event,” Swallen said. “There is always pretty strong demand.”
Advertisers like the upscale audience that typically tunes in to the program. In addition, live events have been generating higher ratings because people watch them in real time rather than record them for viewing later on.
Advertising sales for the Oscar telecast declined during the recession. “Revenue really fell off during the last two years because of the lower unit pricing,” Swallen said.
In 2009, ABC also lost a marquee sponsor, General Motors, which had consistently been one of the biggest spenders for the program. Hyundai stepped in, and continues to be the exclusive auto advertiser for the Academy Awards.
The advertising market has improved dramatically in the last year. Also, rates are boosted for the show because of the relatively low number of commercial spots available.
The academy limits the amount of time devoted to commercials to eight to 10 minutes per hour, Swallen said, including promotional spots for ABC’s other programming. In contrast, a typical prime-time hour contains 16 to 17 minutes of commercial time.
