Uneven Performance

October 15, 2008       Tom Pope      

Operation Smile expected 1.2 million viewers from short, direct response television (DRTV) ads during the recent Summer Olympics. The media buys scored big with 2.7 million viewers.

The reason wasn’t because record numbers saw the games, or that some slots aired during prime time.

Norfolk, Va.-based Smile’s awareness campaign hit big because the nonprofit used NBC’s affiliate in Los Angeles, KNBC 4, during a three-week period starting the beginning of August, just as the Olympics appeared on the network. The spots aired during the local feed of the broadcast.

"The number of viewers doubled from our expectations," said Kyla Shawyer, senior vice president response marketing and development for the nonprofit.

According to Wikipedia, the most commonly cited Nielsen results are reported in two measurements: ratings points and share, usually reported as (ratings points/share).

As of August 27, 2007, there were an estimated 112.8 million television households in the United States. A single national ratings point represents 1 percent of the total number, or 1,128,000 households. Share is the percentage of television sets in use tuned to the program. Smile’s message informed people about the goals. "We used Billy Bush and focused on a country from around the world where children were shown," she said. "We had a call to action to make a pledge or become a partner."

The organization didn’t think first-time donors would appear. "It’s difficult gaining donations from a 60- or 30-second spot," she said.

"The big question was how effective our ground work would be for awareness when we go into that market with our long forms," Shawyer said. "We wanted to increase our response because of a gala event during September."

While it’s expensive to buy television time in Los Angeles, "a good deal" happened because NBC had some inventory and was testing various new approaches. "We were part of the test with banner ads and click-throughs," she said.

The Olympics aired on NBC properties that comprised NBC Universal and cable networks like MSNBC and USA. The NBC planning centered on an $894 million gamble, according to Mediaweek, that focused on reaching people who used video on demand, mobile devices and online technology.

Through the first 13 days, viewership reached 206 million people. Through August 20th, NBC averaged 27.8 million viewers in prime time on the national feed. That figure represented 10 percent more than the 2004 Olympics. This coup happened in part because NBC aired live events.

"It’s challenging to make the price work for most nonprofits in local market affiliates," said Kevin White, vice president of media for Russ Reid, a Pasadena, Calif.-based full service agency that works with nonprofits. "They came up with packages that were affordable and for some significant number of viewers."

NBC did well to set the stage for a multi-platform event, according to White. "The driver is still television, so this Olympics is a first-time cross-platform approach," he said. "A multi-channel approach with events will continue in the future."

White explained that nonprofits that used other cable DRTV suffered with decreases as audiences flocked to NBC. The decreases hit across the board with the number of people responding declining between 30 and 35 percent.

"We didn’t break down the parts of the day, although the softer parts could have been affected at a 20-to-25 percent level," he said.

The shift came not as much from cable as everywhere else in the direction of NBC. "The regular networks of CBS, ABC, and FOX broadcasting had terrible ratings," he said. "They witnessed the lowest people-watched-week since they started using the people meter system," said White.

The people meter system is an audience measurement system that can track consumer exposure to any encoded broadcast signal.

White explained that he stayed away from airing spots during the opening ceremonies. Throughout the week, media buying was a little easier in getting around the audience shift. "Sometimes we can find some great buys to offset the Olympics as long as we stay away from the tricky prime time," he said.

Who is the audience that is shifting? "A significant factor is that more women are watching the Olympics," he said. "The Olympics really gets large audiences across demographics and appeals to a wide range of viewers."

Cable is trickier to judge because that sector tends to be more fragmented and smaller. "It’s harder to tell what is having an impact on those factions so they typically have lower ratings during the summer," he said.

One nonprofit that faced decreasing results was the American Society For the Prevention of Cruelty To Animals (ASPCA). Call results for the first weekend fell off 20 to 30 percent compared to that ordinarily seen on the weekend during the summer, according to Steve Froehlich, director of development analytics.

"The theory is that the Olympics are drawing away channel surfers to network TV," he said "Fewer people are watching cable."

Froehlich compared the present audience shift with the previous Olympics when he worked on a DRTV program for Greenpeace. "While we saw similar decreases in responses, that was nothing compared to the recent ratings," he said. "The weakening was about half of today’s."

Running on NBC was more expensive as the rates went up due to the games. Luckily the DRTV market has adjusted in some favor for nonprofits, according to Froehlich. "Our negotiations have been at a lower level of costs due to leftover media that isn’t being sold to general advertisers," he said. "A weaker demand for general advertising has created more inventory on the direct response side. We’ve been able to offset the lower amount of call volumes."

Lower costs vary with some around half of the usual and some with a reduction of a few hundred dollars. "Overall, it’s around 30 percent," he said.

In the DRTV world, planners place bids for TV spots in an auction process where bids are submitted to stations from what the bidder is willing to pay. The bidder then finds out a couple of days prior to airing whether that bid has been accepted.

Most direct response on cable networks dipped 10 to 20 percent for campaigns monitored by Peter Koeppel, founder and president of Koeppel Direct in Dallas, Texas. Certain campaigns were affected more than others, according to Koeppel. Oxygen was a network where he saw direct response rates reduced by 15-20 percent outside of the 6 to 8 p.m. time block when the Olympics aired. Rates on most of the other non-NBC cable networks remained the same.

"BBC America was a network where we saw a drop-off in consumer response during the Olympics," he said. "Response on Animal Planet was not affected," said Koeppel.

There might be some residual effects. "People may be a little burnt out on television with the Olympics followed by the [political] conventions," he said.

Not all nonprofits found decreased response during the Olympics telecast. The Christian Children’s Fund (CCF) in Richmond, Va., ran short form 120’s on a variety of stations. "We’re probably not noticing a decline," said Mary Arnold, the director of marketing. "We’re in many different places on a weekly basis so we don’t focus on the weekend."

CCF found many opportunities outside the Olympics that could counter any detraction from the two-week period. "We have not seen a decrease in our clearings or lead generations," she said.

CCF does notice getting lower prices from stations as most advertising has dropped in the cost per spot. "We moved to a lower price quarter during that time in the industry," she said. "Also, a number of advertisers pulled out of some television."

CCF tries to buy at the lowest price and that poses a risk. "If we offer a low price that helps us and someone pays more, we would lose that opportunity — we’re balancing a tightrope," she said.

"We don’t know whether more people are watching (because of the Olympics) or whether they’re shifting to NBC," she said. "NBC must be hoping they’ll stick because they have been running promos for the fall shows."

CCF couldn’t compare the present Olympics with the Winter games. "We knew the Olympics were coming, so we tried to buy around them because many cable networks ran good counter offers." she said.

Does the response decline teach lessons for the next Olympic go-round? Most likely the future will offer more options in other ways, White explained. More of a decline could be coming with traditional methods of using television.

Shawyer’s message to nonprofits is that the strategy will be different. "We’ll have tremendous changes from network through mobiles and text messages," she said. "Other media will develop and the question is how fast interactive methods will become more prevalent through the country in other platforms."

Tom Pope, a New York City-based journalist, writes regarding management issues.