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Tokyo Olympics bring in record-breaking TV ad spend for NBC

The news: The 2021 Tokyo Olympics will set a new record for NBC’s US TV ad sales, according to Kantar Media data cited by MediaPost. Further, Kantar found that 63% of the US population still plans to watch the Olympics this year.

More on this: While there’s been a lot of tumult concerning the upcoming games, which kick off this Friday, Kantar predicts that NBC’s US TV ad sales will hit a whopping $2.25 billion, up 20% from the 2016 Rio de Janeiro games, which reached $1.85 billion.

  • The consistency of viewership makes it easy for NBC to boost ad prices every four years, especially following the postponement of the major event.
  • Despite ongoing protests of the games on the ground in Tokyo, this news aligns with NBCUniversal's own predictions of an increase in sales.
  • COVID-19 cases have skyrocketed in Japan this year, and vaccination rates are still low. This has led citizens to fear that a huge event like the Olympics will cause more cases, despite the International Olympic Committee’s promises to keep attendance at 50% capacity and bar attendance by non-Japan residents.

The bigger picture: It’s expected for Olympics ad sales to increase every four years like this, but it’s still a good sign after a rough year, given the pandemic’s effects on global ad spend. Furthermore, it shows that as digital TV viewership rises and many cut the cable cord, certain events can still break through in such a fragmented media environment.

  • The 2016 Rio Olympics also saw US TV ad sales jump 20% compared with the London Olympics in 2012, which at the time meant a record-breaking $1.33 billion, per Kantar.
  • Despite dampened sentiment around the games, advertisers will likely be the last to back away from the enticement of a large-scale, live TV event. For context, 53% of the US population thinks the Tokyo Olympics should be postponed further or canceled altogether.
  • Regardless, with 63% of US-based viewers saying they plan to watch, it’s no surprise that NBC was able to break records yet again.
  • For reference, we expect overall US TV ad spend to hit $65.90 billion this year, even as growth continues to slow.