Commercials May Not Be 'Time-Sensitive,' But What About Their Price?
Les Moonves, president and chief executive officer of CBS Corp., says hogwash, because 80-85% of TV commercials are not “time-sensitive.” Therefore they should be counted and paid for by marketers, no matter when they are seen.
Which commercials are ‘time-sensitive’? Those from movie and retail marketers, accounting for around 15- 20% of the total, according to one cable advertising executive.
Of course, marketers still have their worries about fast-forwarding through commercials. But hold that thought for a second.
TV networks in the near term might work on a two-tier or three-tier system to guarantee ratings. Not only could they continue the current industry standard – Nielsen’s average commercial rating plus three days of time-shifting (C3) -- but perhaps C7, C14, and even C30.
Right now, more than a few networks have spilled the beans to MediaPost and others that they have been making a handful of C7 deals.
Back to some marketers’ concerns: Time-shifting through DVRs has led to the fast-forwarding of commercials. But increasingly, the viewing of network shows from video on demand services is being included in the C3 metric. And those VOD services disengage the ability to fast-forward through commercials.
When “dynamic ad insertion” rolls out to many platforms, TV networks and programmers will be able to insert new commercials after three days. Movie and retailing marketers would be more easily persuaded to buy.
What this all comes down to is price. Those $32- 35 C3 guarantees for a thousand 18-49 viewers may have company. Maybe C7 or C14 guarantees will have a 10% or 20% discount, with the assumption for more fast-forwarding activity.
Networks want to be paid for all viewing – whether on TV sets, PCs, tablets, smartphones, Xbox, or otherwise.
That’s their right. But commercial prices have yet to be determined -- with their time-sensitivity a factor.