TV ratings from the summer Olympics are down. Live streams across various platforms, though, are way up.
NBC reports a 232% increase in live streams on August 10th versus the same day of the Olympics in 2012. On that day in 2016, live streaming topped ONE BILLION MINUTES through the NBC Sports and NBCOlympics.com app.
That’s encouraging news for the digital side of the business, but the TV side – where the bulk of the money is made – is suffering.
The opening ceremonies was down 28% versus four years ago and down some 25%+ overall versus the last Summer Olympics. The 17.2 overnight rating is the lowest opening ceremony ratings in more than two decades. Not since the 1992 Olympics in Barcelona has there been a less watched opening night.
Advertiser Guarantees
In TV, when an advertiser buys an ad in a high profile event like The Olympics, they are typically given a ratings guarantee. When the program fails to deliver close to that rating, the network will typically offer a “make good.” That means they will make up the missed rating points by giving the advertiser a free commercial in another program.
Bloomberg reports that NBC will do make goods for advertisers due to lower than promised ratings.
For the Rio Olympics, NBC promised an average prime-time rating on its broadcast network of 18, according to one ad buyer who asked not to be identified discussing private information. NBC’s broadcast network is averaging a 15.6 prime-time rating, Lazarus said Thursday. – Bloomberg Technology
NBC isn’t going to tell you what they promised advertisers. I wouldn’t either. But Bloomberg Technology speculates that they may be missing the mark by roughly 3 million homes… with every prime time commercial. That’s a lot of make goods.
The under-delivery means valuable commercial time will have to go to make up the ratings lost and the time can’t be sold to other advertisers. Depending on the shortfall and the specific rating guarantees, the network may or may not be able to make up all the lost rating points within the Olympics itself. NBC says it isn’t worried, though.
“We build in inventory to make sure we deliver what we promised them. We will leave the Olympic games with every advertiser getting exactly what we agreed upon with them.” – Mark Lazarus, chairman of NBC Sports Group in a call with reporters.
Paul Dughi.com 