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Marketing and Sponsorship

NBC Already 75% Sold Out For Sochi, Hopes To Top $800M And Set Winter Games Record

NBC Sports has sold 75% of its advertising inventory for the '14 Sochi Games and hopes to top $800M in sales, which would set a record for a Winter Games. A major driver of the increase stems from a change in NBC’s approach to selling advertising on NBCOlympics.com. For the first time, NBC is limiting the number of companies it will feature on its website to its 16 biggest TV advertisers, and it has already sold out all 16 of those digital advertising positions. The early sale results are a major improvement from sales ahead of the '10 Vancouver Games, when NBC Sports sold just 74-76% of its inventory and lost $200M on the Olympics. Its goal was to sell more than $650M in advertising for Vancouver. NBC Sports Group Exec VP/Sales & Marketing Seth Winter said his team expects to sell more than 80% of its advertising inventory for Sochi. The last time the group sold more than 80% of its advertising for an Olympics was Beijing in '08. “The story is nothing short of fantastic,” Winter said. “To think we could come close to what we did for Beijing is nothing short of miraculous.” Winter credited strong demand from USOC and IOC sponsors with driving sales. USOC sponsors such as BP, Kellogg’s, BMW, Chobani, Citi, TD Ameritrade, Liberty Mutual and Smucker’s have all committed to advertising. IOC sponsors such as P&G, Visa, McDonald’s, Coca-Cola and GE have all signed on to advertise, as well (Tripp Mickle, Staff Writer). AD AGE's Michael McCarthy notes there were "concerns the six-hour time difference between the U.S. and Russia would hurt demand." But "brisk sales for Sochi are 'handily eclipsing' those" last two North American Olympics -- Vancouver in '10 and the '02 Salt Lake Games. NBC thinks it is "possible to sell out ad time for Sochi, which is difficult for an Olympic broadcaster given the time and inventory of the multi-week games" (ADAGE.com, 5/16).

A-B, HILTON NOT BUYING AD TIME: Of the USOC’s 15 largest sponsors, only Anheuser-Busch and Hilton have opted not to buy advertising. This will be the first time in a decade that A-B has not advertised during an Olympics. By comparison, it had 103 spots in the '06 Turin Games. Hilton chose not to advertise during last summer's London Games as well. A-B VP/Marketing Paul Chibe said the company is focused on its official sponsorship of Team USA. He added, “With respect to advertising, TV media is not the only game in town. We will activate in new, creative ways.” Among IOC sponsors, Winter said NBC is still in talks with Samsung, Dow and Panasonic. NBC Sports also had success in selling advertising beyond Olympic sponsors. It has closed a deal with Carnival Cruises, GM, several movie studios, retailers and technology companies, Winter said. NBC’s new approach to digital sales also boosted its advertising sales total. Winter said NBC decided to limit the number of digital advertisers it will have to 16 in large part because it has less video content available online for Sochi, which has just eight sports, than it did for London, which featured 28 sports. But having less inventory helped boost demand for digital advertising, and NBC was able to sell out of those 16 positions quickly. Only TV buyers who hit a “certain threshold” made the list of 16 advertisers, Winter said, and as a result, they will benefit from less advertising clutter on NBCOlympics.com (Mickle). The WALL STREET JOURNAL's Matthew Futterman notes Winter "described the move by Anheuser Busch InBev as 'a shock' since sports has played such a central role in the company's marketing strategy." Meanwhile, NBC could face "record production costs for the Sochi production, offsetting the strong ad sales" (WALL STREET JOURNAL, 5/16).

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