The Oscars Commercial Breaks

By: Katelyn Elvers

Many people think of the Oscars as this luxury event held by the academy to give awards to stars and movies to commend them for their outstanding work in the movie making industry. However the real Oscar prize goes out to ad companies for spending millions of dollars to air their commercial during the Oscar commercial breaks, for without the ads the Oscars would not air on live TV every year. Much like the price of movie tickets, the cost airing ads during the Oscars continues to rise. The 30 second slots for the ABC broad cast, during the Oscars, cost roughly $1.8 million; that is an increase of 10% vs. the 2013 ads, according to a report from specialist Kantar Media.

So why do companies pay so much? Well commercial time at the Oscars is scarce. The Oscar boasts having a low number of commercials averaging out to about eight to ten minutes per hour including promotional sports for ABC’s other programming. In contrast, a typical prime-time hour contains 16 to 17 minutes of commercial time. Does this mean airing an ad at the Oscars is a smart investment? Well that question cannot be answered until the marginal benefit is weighed against the marginal cost.

The marginal benefits of airing your commercial during the Oscars is the audience and the fact that everyone wants to watch the Oscars live so your commercial is guaranteed to be viewed. To put the audience number in perspective this past Academy Awards was televised live to more than 200 countries. .

This graph above shows the total amount of money spent in millions versus the amount of 30 second intervals of Oscar commercial airing time. After three consecutive years of stable ad prices and revenue, the average cost of a 30-second ad during the Academy Awards fell 22.6% in 2009, to $1.31 million, from $1.69 million the previous year (Kantar Media). However if this graph was extended it would be clear that the prices of ads have gone up as the audience of viewers grows and the demand for a time slot increases.

Big-event TV seems to have found a happy home in multimedia sweet-spot. These events, which also include the Super Bowl, Grammy Awards and the Golden Globe Awards tend to not only attract huge TV viewership but also massive multimedia followings. Many large companies and advertising agencies view these huge televised events as rare opportunities, where they can reach a big, live audience. In addition these companies know that the audience cannot simply fast forward through their entire commercial. However not any company or store will air their commercial. The companies that air their commercials normally reach out to the female market because in a way the “Oscars is like the super bowl for girls” (Swallen). The chart below shows the Top advertising companies of 2009 that purchased a 30 second commercial time slot during the Oscars.

As expected by the chart above the many companies that bought a time slot reached out to the female market (Department stores, cosmetics, and Hair Care). In addition have the money to air their commercial will say it is worth spending tone of money to air commercial during the Oscars, because everyone is watching.

Sources:

· http://t1.gstatic.com/images?q=tbn:ANd9GcQXMdV2vN43pAzA7JYbN9ha1Br3pJEQgvMX1SV2EKdJwldKboTSlg:s3.amazonaws.com/img.goldderby.com/ck/images/oscar%2520square.jpg

· http://www.goldderby.com/news/2131/news-nuggets-a-30-second-oscar-ad-is-going-to-cost-you.html

"Real-World Education for Modern Marketers." MarketingProfs. N.p., n.d. Web. 11 Mar. 2014. <http://www.marketingprofs.com/charts/2010/3448/academy-awards-advertising-711m-over-past-decade>.