Buyers Not Jumping Through NCAA Hoops

Jan 24, 2005  •  Post A Comment

CBS’s sales of advertising during the NCAA College Basketball Tournament this year may be more March Moan than March Madness.

To date, CBS’s sales are down compared with this time a year ago. So far, just under 80 percent of its commercial inventory has been sold against nearly 90 percent to 95 percent at the same point a year ago.

“Right now we are a little bit behind,” said John Bogusz, executive VP of sports sales and marketing for CBS. “That’s due to one or two financial companies that, for various reasons, may not participate this year. We are still writing business, but it is moderate right now.”

Mr. Bogusz wouldn’t disclose which advertisers dropped out, but said a major new corporate partner will be announced this week.

TV program prices for the NCAA Tournament are 5 percent to 7 percent higher than a year ago, according to several media buyers. Mr. Bogusz would say only that prices are in the “mid-single-digit-percent increase” range. Still, other deals, according to agency executives, are expected to be completed at low-single-digit-percent increases.

“The TV marketplace has been relatively friendly and not onerous,” said Gary Carr, senior VP of national broadcast for New York-based media buyer Targetcast TCM. “There is affordable inventory to be had almost everywhere.”

Prices for 30-second spots during the tournament range from $60,000 to $350,000. One 30-second commercial in the NCAA final game this year is going for $900,000, slightly higher than a year ago. Mr. Bogusz said a number of units remain to be sold.

The NCAA Tournament has also been the victim of the current soft TV advertising market. CBS-along with the other networks-has been affected by lower-than-expected spending in the first quarter of 2005. It is on a pace with activity in fourth quarter 2004. The result has been lower prices for certain shows, media agency executives said.

Many deals are being made at prices lower than what was charged last spring during the upfront market. “That market is not as active as we would like right now,” Mr. Bogusz said.

As part of CBS’s agreement with the NCAA, the network sells both ad time in all 26 tournament games and sponsorships. As an NCAA Tournament sponsor, corporations can use logos, trademarks, NCAA Tournament video and other NCAA material in their advertising. The biggest spenders, dubbed Corporate Champions by CBS, are General Motors’ Pontiac division, Coca-Cola and Cingular Wireless. Sponsors with a smaller commitment include Kraft Foods, Monster.com and insurance company The Hartford.

Typically, CBS combines sales of regular-season games in a package with the tournament. Those packages may also include PGA golf tournaments. Media agency executives said CBS offers a ratings guarantee, but it varies according to individual package and advertiser. CBS charges on average $20 per thousand viewers for the entire tournament, one media buying executive said.

Last year the entire NCAA Tournament averaged a Nielsen Media Research 6.2 rating-24 percent higher than the year before and 5 percent below 2002. The 2004 championship game earned a historically low 11.0 rating/18 share-the lowest-rated final since the tournament first aired in prime time back in 1973 and 3 percent lower than the year before.

While the NCAA Tournament has been a tough sell, Fox is doing just fine with the upcoming Super Bowl. Media agency analysts attribute this to the fact the Super Bowl is just one high-profile game with limited inventory. In the NCAA Tournament-with 26 games, each with 40 or 50 spots-there is less focus on single games and a great deal more inventory to sell.