Mar 24, 2020 - Economy

Olympics postponement throws more than $1 billion in advertising into limbo

Sara Fischer

Illustration of the coronavirus arranged as the Olympic rings — Illustration: Aïda Amer/Axios

The postponement of the 2020 Olympic Games to next year creates problems for advertisers, who could now potentially be facing a more crowded media calendar.

What they're saying: "Cancelled is actually the easier scenario than postponed because it's a definitive yes or no kind of thing," says Jon Swallen, CRO of the media division at Kantar, an advertising analytics company.

"The biggest impact from an advertising perspective would probably go to the network selling the airtime," says Swallen.

NBCUniversal says it's already sold a record $1.25 billion in national ads around the 2020 Tokyo games, surpassing its previous record of $1.2 billion in ad sales during the 2016 games in Rio de Janeiro.

NBCUniversal and its parent Comcast say they have insurance built into its contracts for lost expenses. "There should be no losses should there not be an Olympics, just wouldn’t be a profit this year," Comcast CEO Brian Roberts has said.

The big problem: "It's unlikely NBCU can replace ads against programming at the same prices they were selling it for originally for the Olympics, which is a potential revenue hit for them," says Swallen.

Don't forget: There's a huge opportunity cost for marketers needing to reallocate all of their lost sports ad placements.

"There's going to be a spike in available inventory as cancellations come in," says Swallen. It's going to be be better economics for those that come back in and buy earlier."

Go deeper: How the coronavirus-driven sports outage impacts TV and advertising

Add Axios on Google

Olympics postponement throws more than $1 billion in advertising into limbo

What to read next