NBCU to Reduce Ads Further; Prime Pods in More Shows

Use of CFlight metric to expand
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Linda Yaccarino, chairman of NBCUniversal Ad Sales and Client Partnerships, said she plans to further cut back on the commercial loads on the company’s TV networks and will air its new short, one-minute Prime Pods in more shows this year.

Linda Yaccarino

Linda Yaccarino

NBCU has been among the most prominent media companies talking about the need to lure viewers back from ad-free services and to increase the value of its commercials to marketers.

Related: Yaccarino Calls for TV to Meet Consumer Needs

In a year-end memo to staff, Yaccarino said she wanted NBCU’s ad business to set a new standard in 2019.

“We know people want better viewing experiences and marketers want growth. It’s up to us to deliver both. We need to liberate ourselves from legacy processes and move towards a system that accurately reflects consumer behavior, and client needs,” Yaccarino said.

Related: NBCU Plans to Cut Ads by 10% in Primetime

A year ago, Yaccarino said NBCU would reduce its ad loads by 10% and its average length of its commercial breaks by 20%. One way to accomplish that was by introducing one-minute Prime Pods, which began airing in the 50 top shows on NBCU’s broadcast and cable networks this season.

In the memo, Yaccarino called the Prime Pods a success.

NBCU logo 16x9

“Every KPI [key performance indicator] has improved—higher likability, brand recall, and conversions—proving the effectiveness of smarter television,” she said.

More specifically, the Prime Pods generated a 38% lift in ad likeability, consumers are 39% more likely to search for brands in Prime Pods, NBCU said.

In 2019, “we’ll continue to reduce time and clutter and expand Prime Pods across the portfolio. Plus, we’ll make ad placement smarter, more targeted, and more relevant by pioneering Contextual Intelligence,” she said.

Another step NBCU took in 2018 was to introduce a new metric--called CFlight--that in addition to the audiences credited by Nielsen--includes viewing digital and streaming viewing counted by other measurement sources.

Related: NBCU Upfront Volume Up 5%; NBC Prime Up 7%

NBCU used CFlight when negotiating upfront advertising deals for its entertainment shows in primetime this TV season.

"This Is Us" (NBC), Episode 218 (The Wedding)

One-minute Prime Pods aired in top NBCU shows including 'This is Us.'

“For too long, we’ve been tied to traditional metrics. Marketers deserve to base their decisions on business results, but ratings don’t even come close,” Yaccarino said. “At NBCUniversal, we’re going to lessen our reliance on legacy measurement. Instead, we’ll continue to invest in measurement that focuses on audiences and business outcomes, including scaling CFlight across our entire portfolio.”

NBCU will also be increasing its investment at advertising technology, which is already in the tens of million of dollars.

“We’ll again double our investments in technology to enhance our ongoing automation and optimization efforts. We’ll also continue to prove digital advertising can be a safe and valuable experience for people and marketers,” Yaccarino said.

Last year, Yaccarino invited the TV ad industry, including buyers, clients, measurement companies, tech companies and rival media companies, to an event to discuss challenges and come up with solutions to the problems the business faced.

Related: Industry Conference Leaves Ad Execs Seeking Next Step

After that meeting, NBCU, which generates more than $10 billion a year in advertising revenue, began taking steps to address those issues.

Yaccarino said NBCU will continue to move unilaterally, but will also look to work with the industry through OpenAP and other initiatives.

“So now it’s up to us. These massive transformations are only possible if we work smarter and more collaboratively, as a company and an industry. And they will only happen if we stay true to our values, and continue to put our audiences and clients first,” she said in her memo.

“That’s why I’ll be looking to each of you to help set this new standard in every way you can. And—to accelerate progress, encourage partnership, inspire consensus, and hold ourselves and others accountable—we’ll also reconvene the industry in the first half of 2019,” she said.

Here is Linda Yaccarino’s memo to staff:

Hello all,

I hope you had a wonderful Thanksgiving—filled with fun conversations around the table, and restful, post-dinner naps. As we return from the holiday, I want to express my gratitude for this entire team, celebrate our accomplishments, and share our vision for the year ahead. To do it justice, it takes a long memo, but I promise it’s worth the read.

At NBCUniversal, we’ve always held ourselves to high standards of quality, transparency, service, and safety. Every action we take is guided by our values as a company and the value we deliver. And now, as our industry faces an exciting inflection point, we must go even further.

It’s time to set a new standard—for ourselves, our viewers, our marketing partners, and the entire industry. But you might be wondering: What exactly does “set a new standard” actually mean?

Setting the new standard is a reminder to place ourselves in the minds of consumers and clients. It’s a challenge to rethink everything we do while building upon the strong foundation we’ve established. It’s raising the bar across our business—from improving the viewing experience, to connecting brands to scaled audiences, to creating outcome-based measurement, to developing technology solutions with purpose.

In other words, setting a new standard means refusing to settle for the status quo.

Our journey to set a new standard began one year ago, when we convened our partners, colleagues, and competitors for the State of the Industry Forum. We confronted the inertia our industry faces and gave each other permission to make bold changes. Since that gathering, our company has led the way forward:

  • We reimagined the viewing experience with commercial innovation across our networks: just consider the success of Prime Pods. Every KPI has improved—higher likability, brand recall, and conversions—proving the effectiveness of smarter television.
  • We doubled our investments in technology to expand marketers’ buying options through automated offerings. Our advanced advertising solutions are secure, easy to use, affordable, and deliver real outcomes.
  • We created CFLIGHT, a new cross-platform measurement that finally shows how real people consume our content across all screens. This transparent metric is being adopted and embraced by the industry.
  • We deepened our digital partnerships with Apple, Buzzfeed, Snapchat and Vox, and licensed our technology in OpenAP. Plus, we also have our new global partners at Sky.
  • We evolved our organizational structure around mass reach and targeted audiences, strengthened our creative capabilities, and launched an ROI program for D2C businesses.

This is what transformation looks like. But the reality is, we need to do more.

We know people want better viewing experiences and marketers want growth. It’s up to us to deliver both. We need to liberate ourselves from legacy processes and move towards a system that accurately reflects consumer behavior, and client needs.

In 2019, as a media and technology company, NBCUniversal will set new standards.

  • We will set the new standard for the viewing experience with commercial innovation. People love our premium content and trust our family of networks. We must honor their experience as we design better ways to engage with brands. That’s why we’ll continue to reduce time and clutter and expand Prime Pods across the portfolio. Plus, we’ll make ad placement smarter, more targeted, and more relevant by pioneering Contextual Intelligence.
  • We will continue setting the new standard in measurement. For too long, we’ve been tied to traditional metrics. Marketers deserve to base their decisions on business results, but ratings don’t even come close. At NBCUniversal, we’re going to lessen our reliance on legacy measurement. Instead, we’ll continue to invest in measurement that focuses on audiences and business outcomes, including scaling CFLIGHT across our entire portfolio.
  • We will set the new standard in technology in our industry—and we’ll use that technology for good. We want to democratize television advertising, so more businesses can create strong brands and connect with real consumers. We’ll again double our investments in technology to enhance our ongoing automation and optimization efforts. We’ll also continue to prove digital advertising can be a safe and valuable experience for people and marketers. Don’t let anyone tell you differently.

So now it’s up to us. These massive transformations are only possible if we work smarter and more collaboratively, as a company and an industry. And they will only happen if we stay true to our values, and continue to put our audiences and clients first.

That’s why I’ll be looking to each of you to help set this new standard in every way you can. And—to accelerate progress, encourage partnership, inspire consensus, and hold ourselves and others accountable—we’ll also reconvene the industry in the first half of 2019.

I feel privileged to work with this incredible team and look forward to everything we’ll accomplish in the year ahead.

Linda

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