TV Networks Put Harder Sell Behind Hard News as 2020 Election Draws Closer (EXCLUSIVE)
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There’s likely little common ground between MSNBC’s Rachel Maddow and Fox News Channel’s Sean Hannity, but the executives who run their respective news outlets have found something upon which they both can agree.
Both NBCUniversal and Fox Corp. are talking to advertisers about recent or ongoing research that demonstrates viewers don’t think negatively about the advertisers in news programs, no matter whether the host leans toward a particular political view or if the news itself is extremely serious.
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Viewers “without fail say they don’t penalize a brand for sponsoring something that the company may not stand for,” says Laura Molen, president of NBCUniversal ad sales, in an interview. NBCU recently dispatched Red Lantern Strategy, a market-research firm, to talk with viewers of MSNBC, CNN and Fox News in Dallas and New York. Over the course of detailed hour-long interviews, Molen says, 18 respondents described a favorite news program as “their show” – and didn’t attach any controversy to sponsors.
Viewers “understand the distinction between editorial and advertising,” says Jeff Collins, executive vice president of ad sales for Fox News, which since last year has made the case that its viewers appreciate the commercials they know help put Bret Baier and Chris Wallace on their TV screens.
There’s every reason in 2020 for big media companies that own large news divisions to make a new pitch for ad dollars. After all, this year’s presidential election will give rise to any number of debates, town halls, election programs and special reports – all of which can bring in extra millions in advertising cash. But TV giants have another motive in calling attention to news this year: In an era when more viewers are watching scripted programming at times of their own choosing, the news programs are becoming a bigger part of their business and often generate some of TV’s largest live audiences – and some of the web’s most attentive.
TV news has long attracted millions of dollars from pharmaceutical companies, financial-services firms and direct-response advertisers. The hope among the big media outlets is that they can capture more interest from sponsors who normally gravitate to dramas and comedies, like movie studios, fast-food chains and beverage marketers. To do so, they will have to convince Madison Avenue mainstays to get over some of their fears about TV news. Some marketers hate lining up their ads next to scenes of crisis, war or carnage. Others have long-held policies about not placing their commercials next to “single-host opinion” programs.
The networks’ pitch is that “in an on-demand and delayed viewing world, topical live content should be viewed as a premium,” says Dave Sederbaum, executive vice president of video investment for Amplifi US, a large media-buying unit that is part of Dentsu Aegis Network. But many advertisers may not be swayed. “The reality that we continue to hear from our clients is that the ones who support news will continue, and those that have stayed away will continue to stay away,” he adds. “The ‘talking heads’ in primetime command a loyal and passionate audience, but they are still polarizing and not worth the brand association for some of our clients. The appeal of live reach will never outweigh the fear of negative brand perception.”
The networks are keeping up their push, saying that in a world where many viewers go to Amazon Prime, Netflix and Hulu for their entertainment fix, the news programs offer something that is hard to find elsewhere: big, live crowds. CNN has seen robust demand for commercial time for the first months of 2020, notes Joe Hogan, executive vice president of sales and marketing for network parent WarnerMedia. “This is where consumers are leaning in and this is how they are choosing to spend their days, nights and evenings,” he says. Cable-news’ 9 p.m. hour aggregates more than 7 million viewers across Fox News’ “Hannity,” MSNBC’s “Rachel Maddow Show” and CNN’s “Cuomo Prime Time,” according to 2019 viewership figures from Nielsen.
Consider the case of ABC’s “World News Tonight.” The program lured an average of more than 8.6 million viewers in the fourth quarter of 2019 – an audience that, while older than the crowd that watches scripted primetime, is greater than the live viewership that tunes in many entries in ABC’s weeknight schedule. And with younger viewers seeking out news online, the media companies feel they can bring in the youthful demographic advertisers want, even if their main, linear connections skew older. “We see a much bigger lean-in audience” among younger viewers, says Lisa Valentino, executive vice president of client and brand solutions at Disney Advertising Sales.
Capturing new ad support for news is critical. NBCUniversal’s parent, Comcast, in 2018 bet $39 billion on an acquisition of European satellite broadcaster, Sky PLC. A big part of making it work is getting NBC News to work more closely with Sky News, and NBCU has been plotting the launch of a new global media outlet that uses resources from both news organizations. The Fox News unit has long been the main financial engine of the Murdoch family’s Fox media conglomerate, but after the company’s sale of its studio and cable assets to Walt Disney last year, the news division represents an even more dominant part of the Fox apparatus. CNN represented approximately 25% of Time Warner’s profit before AT&T purchased the company in 2018.
And new money typically flows in an election year. Fox News Channel is projected to take in nearly $1.32 billion in advertising in 2020, which would mark an increase of 7.9% over 2019, according to Kagan, a market-research firm that is part of S&P Global. CNN is seen securing around $773.1 million, representing an increase of about 11.7%. And MSNBC is expected to win around $723.1 million, according to Kagan, a raise of about 0.8%.
Meanwhile, at the broadcast networks, advertisers committed $1.13 billion to ABC’s “Good Morning America,” NBC’s “Today” and CBS’ “CBS This Morning” in 2018, according to Pew Research Center, and $518 million to the three evening newscasts.
But at a time when Americans are divided on many issues, advocacy groups have placed many news anchors under new scrutiny. In 2017, conservative organizations tried to spur a boycott of Rachel Maddow’s advertisers on MSNBC. Fox News in 2018 shifted advertisers from Tucker Carlson’s and Laura Ingraham’s programs into other parts of its schedule after remarks they made spurred liberal groups’ ire. The moves do not appear to have affected overall advertising performance. “Our ability to consistently deliver live, large, and upscale and engaged audiences has resulted in consistent and stable growth in our advertising revenue,” Fox News Media CEO Suzanne Scott told investors last May, just before the company’s fiscal 2019 came to a close. “This fiscal year is on track to be our highest advertising revenue year ever.”
The news outlets have gone all out to soothe Madison Avenue worries about news content, no matter the venue on which it appears. NBCUniversal sent so far as to examine the biometric responses and facial expressions of people who watched hard news stories. “We found no evidence of hard news having negative associations for advertisers,” says Molen.
CNN, meanwhile, offers a monitor of sentiment online, so it can help clients avoid placing their digital commercials around subjects they feel might offset an ad message. “We get a sense of where the areas are either of competitive or topical concern for a brand, and that opens up a larger percentage of available inventory,” says Christine Cook, chief revenue office of CNN’s digital business.
And the companies are also offering new ad bells and whistles. Fox News and ABC News are working to find new segments built around lifestyle, improvement and lighter news topics that advertisers can sponsor. Fox News Media recently struck an alliance with an ad agency that specializes in creating special content for marketers that fits well with the unit’s programming. CNN operates an internal agency that does similar work.
CNN has begun experimenting with unusual ad formats that separate the commercial from the news story it may buttress. In October of last year, CNN placed a Mercedes-Benz logo on screen during a broadcast of its daytime “Newsroom,” making clear the show was sponsored, not the stories the anchor discussed. CNN has made available a special online ad unit that allows a marketer to live-stream its own content alongside CNN news. Ford, for example, was able to live-stream an auto show
News “is a megaphone,” says Cook. “We draw audiences in real-time.” Now the networks must do the same for advertising as the 2020 election draws closer.
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