ESPN is reportedly giving $20M back to advertisers because the College Football Playoff on New Year’s Eve was such a disaster
ESPN’s broadcast of the New Year’s Eve bowl games — the College Football Playoff semifinals and the Peach Bowl — saw viewership decline than more than a third in 2015. As a result, their advertisers aren’t happy.
A report from John Consoli of Broadcasting & Cable magazine says the network is currently negotiating more than $20 million in make-goods — credits given to advertisers to compensate for mistakes — in response to the broadcast’s lower-than-expected ratings. ESPN had assured advertisers that running two of the season’s biggest bowl games against a night historically reserved for parties and other non-football events would have no negative effect on their total viewers. Now, they’re making up for the lack of viewers during what had been sold as a prime advertising opportunity.
Some media outlets have pointed out that since ESPN sells packages for all the bowl games and a sizable number of advertisers are in all of the games, that the New Year’s Eve ratings shortfalls were considerably mitigated.
One buyer called that analysis “a bunch of spin,” adding that College Football Playoff Committee executive director Bill Hancock’s statement that the New Year’s Eve games’ ratings declines were simply “modest” was “just plain wrong.”
Try selling the “modest” ratings declines to the movie studios that were in those New Year’s Eve games who paid big bucks to reach an audience they wanted to reach immediately that turned out to be more than one-third less than the size that they paid for.
These low ratings have put ESPN in a tough position, especially after they lobbied to change the date of the semifinal games to January 2nd. The College Football Playoff has scheduled New Year’s Eve games in four of the next six years. If advertisers revolt against the reduced viewership of a Dec. 31 bowl lineup, they’ll force the network to choose between its partners in the CFP — an organization to which ESPN is paying $7.3 billion for broadcast rights of their bowl games — and the ad-buyers that provide big chunks of network revenue every year.
CFP executive director Bill Hancock went on record last week and told the New York Times “We don’t make decisions based on television numbers. I don’t have a TV number that influences my measurable for success.” He isn’t prepared to deviate from the organization’s current schedule, either.
However, if low TV numbers continue to sink ESPN to the point where they’re giving back $20 million during the most-watched stretch of the college football season, Nielsen ratings could be a focal point for Playoff executives in 2016 and beyond.