NBCU Makes First 'Outcome' Ad Guarantee, Tied To Movie Ticket Sales For 'Upside'
- by Wayne Friedman , February 8, 2019
Making good on its promise to move beyond legacy TV ratings guarantees, NBCUniversal made its first "business-outcome" TV advertising guarantee — based on movie ticket sales — for the current STXfilms' “The Upside.”
The guarantee was based on U.S. box-office results, where the movie, starring Nicole Kidman, Bryan Cranston and Kevin Hart, earned $20.4 million in its opening weekend, and $76.1 million to date.
The movie premiered on January 11.
STX and NBCUniversal used attribution data from NBCU’s movie ticketing website Fandango to estimate advanced targeting and optimization. NBCU says it used a “performance valuation model directly connected to performance of showtime searches in evaluating an increase in ticket purchases.”
NBCUniversal Audience Studio unit worked with STXfilms and the movie company’s media agency Horizon Media for the campaign.
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NBCU, STXfilms and Horizon Media will make a similar deal for the upcoming animated feature film “UglyDolls,” which premieres on May 3, per NBCU.
TV networks have been looking to move away from traditional age/gender viewership guarantees to more business outcome promises for advertisers -- which can be linked to actual sales, visits to a company’s website, in-store traffic or other metrics.
For the upfront market in 2018, NBCUniversal started CFlight, which makes viewing guarantees for advertising over an entire flight of a brand’s campaign —- beyond C3/C7 rating promises. Nielsen C3/C7 metrics are the average minute commercial rating plus three or seven days of time-shifting viewing.
Last year, for the upfront market, A+E Networks said it was starting a regular effort for limited guarantee deals for advertisers based on business outcomes.
For some years now, many TV networks have offered "secondary guarantees" on data other than TV-based measures.
Agree with moving towards "outcomes-based" guarantees, but who's making the determination of what KPI to base these deals upont? Do we trust TV sales people to determine the correct KPI for making these guarantees? Understand the desire for positive PR as we head into upfront season, but the unintended consequences of choosing the wrong KPI could have disastrous consequences and could\will cost networks millions.
Assuming that the "guarantee" refers to ticket sales or, perhaps, incrremental ticket sales, who determined how many sales were to be guaranteed---the advertiser or the TV network and how much of a CPM premium did the advertiser pay to get the guarantee. Also, if the guarantee wasn't met---whatever it was---did was the network obliged to rebate cash in the appropriate amount or toss in a makegood spot or two from unsold GRP inventory for use at a later date?
What would you suggest?
Going beyond age\sex demo is a "must have" for the future, but my question is whether sales organziations are the best arbiter of what those KPI guarantees will be, knowing it will probably need to differ by marketer. At this point, networks would be well-suited to look higher up the conversion funnel than actual sales. While it sounds like the logical place to start, going straight to conversion sets a dangerous precedent for networks as they assume complete responsibility for the campaign's success and discounts the other components of the "4Ps of Marketing". What if the product stinks? What happens if it's not priced correctly? What happens if the supply chain is disrupted? What happens if it's poorly distributed or delivered? What happens if the creative stinks? What happens if the user experience at the conversion point stinks?, etc.. Good intentions, but they would be well advised to think it through as deeply as possible.
The only time I would guarantee "business outcomes" (i.e. sales) is if I was the solus advertsing channel.
Oh, and yes I would have to have input and approval for the ad content.
And I'd need to know what the competitors would be doing. And I'd need price control over the brand and its competitors as well. There had better not be any new products launched as well. Oh, and perfect weather conditions would be nice.
The old aphorism is that there are only three things guaranteed ... life, death and taxes. I can't see it being extended to include advertising results.
I agree, John. While I applaud NBC's efforts to develop new ways to put a value on its audience, better targeting, etc. I see this as a path that ultimately leads nowhere. Not every one of the things NBC is developing will work. The premium break ----low clutter commercial pods/ high CPM---approach looks like a definite winner, if handled properly, but the so-called "advanced" targeting schemes probably aren't---in part because so much national TV time is placed on a corporate, not a brand by brand basis. The idea of guaranteeing an advertiser a favorable result is simply not workable nor is it something that a media time seller should be asked to do. Sure, play that game for a few advertisers---especially those, like movies, where results come in very quickly after the ads run---but, ultimately, as the seller has no control over the product, how its promoted, its distribution, whatever other promotional efforts including word-of-mouth endorsements are at play, what the competition is doing, etc. the likely result will be watered down guarantees which are almost always met because the seller can't take the risk of accepting wildly optimistic sales hopes by the advertiser. In other words, little or nothing will be gained.
The only thing a media company can guarantee is their audience delivery - in terms of total weight and the balance between the reach and the frequency - for the budget spent.
Having said that I am in 100% agreement that we can do better than we are doing at the moment. I'm working on a project here in Australia which will help TV planning and buying - trying to narrow the gap between what a buy is planned on and what the delivery is based on. Here's hoping it gets the green light!