Table of Contents
- Introduction
- The Evolution of Olympic Advertising
- The Shift to Programmatic Buying
- The Impact on Big-Budget Advertisers
- Future Implications for Sports Advertising
- Conclusion
- FAQ
Introduction
Imagine the Olympic Games, traditionally a domain for big-budget advertisers, becoming accessible to brands with far smaller advertising budgets. This once exclusive advertising platform is being redefined by the advent of programmatic advertising, opening doors for a new demographic of brands to engage with one of the most viewed events globally. For advertisers, the Olympic Games of 2024 present an unprecedented opportunity, thanks to initiatives by NBCU and Warner Bros. Discovery (WBD). These media giants are democratizing access to Olympic advertising inventory through programmatic buying, making it available on platforms like Peacock, Eurosport, and associated apps. This shift could very well reshape the landscape of sports advertising.
In this blog post, we will delve into how programmatic advertising is making the Olympics more accessible than ever, analyze its potential impacts, and explore how this democratization might shape the future of sports advertising. From the reduction in entry barriers to the implications for big-spending advertisers, both opportunities and challenges are abundant. Join us as we navigate this transformative phase in digital advertising.
The Evolution of Olympic Advertising
Historically, advertising during the Olympic Games has been a privilege reserved for brands with deep pockets. The high costs associated with sponsorship and broadcast advertisement created a significant barrier to entry. As a result, only the largest and most established companies could afford to place their ads in front of the vast Olympic audiences.
In recent years, the rise of digital streaming platforms and advancements in ad tech have started to erode these barriers. The 2024 Olympic Games will mark a significant milestone in this evolution, as NBCU and WBD introduce programmatic buying options for their streaming platforms. This change is expected to be a game-changer, particularly for smaller brands aiming to tap into the massive viewership of the Olympics.
The Shift to Programmatic Buying
Expanding Access with Private Marketplaces
NBCU and WBD have opened up significant portions of their Olympic inventory to programmatic buying via private marketplaces (PMPs). For NBCU, this means that Peacock’s comprehensive Olympic coverage—over 5,000 hours of live sports—will be available to programmatic buyers through a partnership with ad tech provider The Trade Desk. Similarly, WBD has launched WBD Connect, giving advertisers programmatic access to ad inventory across CNN International Commercial and WBD Sports Europe, including Eurosport.
This shift allows brands, which previously couldn't afford Olympic advertising, to purchase ads programmatically. PMPs offer a controlled environment where ad placements are sold to vetted buyers, maintaining a level of exclusivity and quality control that traditional direct buys offer.
Democratizing the Marketplace
For smaller brands, programmatic buying represents a lowering of the price of entry into Olympic advertising. Without the need for hefty up-front sponsorship deals, more brands can afford to place their ads in the Olympic space. This democratization not only increases the diversity of advertisers but also enhances the viewing experience by reducing the repetition of ads during broadcasts.
Ronen Benatar from Wavemaker U.S. highlighted that programmatic options "democratize" the Olympic advertising opportunity, allowing more brands to participate without the need for massive budgets.
Enhancing Brand Safety and Excellence
Despite this increased accessibility, NBCU and WBD have taken steps to ensure that the quality and brand safety of the advertising environment remain intact. Using AI-enabled screening systems, like those provided by Hive, NBCU can quickly flag and review ads to ensure compliance with their standards and those of the International Olympic Committee (IOC). This process helps reassure high-budget advertisers that their ads will not run alongside those of lesser quality or conflicting messages.
The Impact on Big-Budget Advertisers
While programmatic buying opens doors for smaller brands, it also presents a unique scenario for big-budget advertisers. Traditional Olympic advertisers, such as Visa, which has been an International Olympic Committee (IOC) partner for 38 years, are responding to these changes with a mix of caution and strategic adaptation.
Maintaining Exclusivity
Visa, for instance, chooses not to participate in programmatic buying; instead, it opts for exclusive advertising routes on platforms like Peacock and NBC’s linear TV and Snapchat channels. Visa’s CMO Mary Ann Reilly emphasized that their exclusivity arrangements provide sufficient brand protection, ensuring their ads aren’t diluted by the influx of smaller advertisers.
Premium Placement
Despite the opening up of ad space, there still exists a structure where premium advertisers can pay a premium to ensure their ads occupy exclusive, high-visibility slots. This maintains a hierarchical structure in ad placements, where the most prominent spots are still reserved for those willing to spend more.
Future Implications for Sports Advertising
The 2024 Olympics could be a watershed moment for programmatic advertising in sports. Should these initiatives prove successful, they could catalyze broader adoption in other major sports leagues and events.
Expanded Opportunities Beyond the Olympics
Alison Levin of NBCU suggests that live sports streaming has already attracted new advertisers to their portfolio, with an 87% growth in advertisers spending on live sports in the previous year. This indicates a strong demand for diversified entry points into sports advertising that programmatic buying can fulfill.
Challenges and Considerations
However, the shift toward programmatic advertising is not without its challenges. Media owners must ensure their technology and demand-side platforms can support the increased volume and complexity of programmatic transactions. Additionally, maintaining the premium nature of Olympic ads while accommodating a more extensive range of advertisers requires a delicate balance of quality control and accessibility.
Conclusion
The integration of programmatic advertising into the Olympic Games marks a significant shift in the advertising landscape. By lowering the barriers to entry, NBCU and WBD are not only democratizing access to one of the most prestigious advertising platforms but also setting a precedent for future sports broadcasts.
This shift promises a more diverse advertising ecosystem, providing opportunities for smaller brands to shine on a global stage while still offering premium placements for top-tier advertisers. As we look to the future, this year's Games may well be remembered as the Olympics that opened up the advertising field, making it more inclusive and dynamic than ever before.
FAQ
Q: What is programmatic advertising?
A: Programmatic advertising refers to the automated buying and selling of digital ad inventory using software and algorithms. This method enables advertisers to target specific audiences more precisely and efficiently.
Q: How does programmatic advertising benefit smaller brands?
A: Programmatic advertising lowers the entry cost and barriers, allowing smaller brands to purchase ad inventory in prestigious spaces like the Olympic Games without needing massive budgets for sponsorship deals.
Q: What platforms are offering programmatic advertising for the Olympics?
A: NBCU is offering programmatic advertising through its Peacock streaming platform, while WBD is doing so through Eurosport and its associated digital properties.
Q: What measures are in place to ensure ad quality and brand safety?
A: NBCU uses AI-enabled screening systems from Hive to review ads for compliance with their standards and IOC rules. Ads that do not meet these criteria are flagged for human moderation.
Q: How might the success of programmatic advertising at the Olympics impact future sports advertising?
A: If programmatic advertising proves successful at the Olympics, it could encourage broader adoption in other major sports leagues and events, potentially changing the landscape of sports advertising by making it more accessible and diverse.
