NBC TV SAYS LESS IS MORE

NBC TV is saying less is more. The network is promising less commercials starting next Fall season. Comcast’s NBC Universal is cutting the number of spots by twenty percent as well as ad time by ten percent during original prime time programming. This is not the only change being made. The network is also adding new formats; thereby, making commercials relevant to the content where they are running. All these new changes are to compete with ad-free Netflix; but will they prove to be successful?

Trial and Error

NBC is not alone in this. Other networks including MTV, TNT, and Nickelodeon are adapting similar cutbacks. But the economics of it all is at question. If there’s a decrease in ad time and space, there will naturally have to be an increase in inventory price. Some networks are already seeing the downfalls. Bob Bakish, CEO of Viacom, blames the company’s 2 percent loss in third quarter revenue to commercial cuts on the networks.

Some have not had any issues at all. Fox stated it sold 30 percent more ad revenue in August after they reduced their commercial time by 20 percent. NBC Universal hopes to have this same luck.

New Developments

Not only will NBCU reduce ads on more than fifty primetime original shows, but they will also introduce the “prime pod”. The newest in A.I. technology will sift through show scripts to pair advertising with relevant show content. The results will run as either the first or last ad and will be extremely exclusive to advertisers. “…The viewer has grown to expect less ads, but more importantly, more relevant ads,” says Linda Yaccarino, chairman of advertising and client partnerships at NBCU.

Experimental ad formats will be put to the test. Audiences have already seen examples in the Olympics and Fox sports programming. All that’s left to do now is to sit back and watch.

Bernie Levi, the author, is the Project Coordinator of Marketing Keys.