NBC will use AI to match advertisers with programming

Dive Brief:

Comcast’s NBC Universal is launching an artificial intelligence-powered tool to scan TV show scripts and match advertisers to the show’s content. The 60-second “prime pod” that results from the match will run during the first or last advertising break of a show, and it will be available to only up to two advertisers, AdAge reports.
NBC also announced that it will reduce the number of ads on its networks running during primetime by 20% and will decrease ad time by 10% beginning this fall. The reductions will occur on more than 50 original shows on NBC, E!, USA and Bravo.
NBC is debuting several new ad formats, including social commercials, which allow brands to sponsor or be integrated into a pod that includes real-time social media commentary from fans. Another is a picture-in-picture format.

Dive Insight:

By cutting the number of ads it shows viewers and the overall amount of ad time, NBC is hoping to meet consumer demand for fewer ads. At the same time, the network is betting on digital technology — something a growing number of traditional TV entities are doing — to enhance the remaining inventory so it is more relevant and by extending the reach to social media, where many viewers are actively engaged while watching their favorite programs. The higher-quality, more relevant ad inventory will likely come with a premium price tag, as NBC will still need to maintain revenue levels. Marketers will have to decide if they’re willing to pay more to be surrounded by fewer commercials from other brands.

NBC Universal’s new AI system for matching advertisers with programming will help the network create opportunities for marketers to better target specific segments with more contextually relevant spots.

“Like any ad, same-day ad measurement will be key to ensuring the effectiveness of this new format, and with the reduced number of ad spots, it will be more important than ever for advertisers and networks to work together to make in-flight changes and optimize ads," Kevin O’Reilly, chief strategy officer for TVSquared, said in a statement emailed to Marketing Dive.

Giving marketers more options and better placement strategies comes as TV advertising suffered major declines in 2017, when ad sales fell 7.8% to $61.8 billion, the biggest decline in at least the past 20 years outside of a recession, per Magna Global Data. Outside of cyclical live TV events like the Super Bowl, Winter Olympics and U.S. midterm elections, networks are unlikely to recover from the slump in 2018. While the year has gotten off to a good start for digital and TV ads, live TV viewership has sharply declined over the past few years and networks are struggling to compete with streaming services, which are seeing their number of subscribers soar.

NBC has reduced ad loads around certain programming before. The network planned to reduce the number of commercials in “Saturday Night Live” by 30%. In the aggregate, TV commercial loads increased to 11 minutes per hour in January 2018, up from 10.5 in January 2017, per Pivotal Research Group data cited in the AdAge report.