Disney Sales Team Cleans Up on March Madness Ad Market

Image source: Sportico/Getty

Author: Anthony Crupi Source: Sportico

The Walt Disney Co. telegraphed the degree to which it is committed to women’s sports earlier this year when it signed off on an eight-year, $920 million extension of its NCAA rights agreement. At the time the deal was finalized, NCAA president Charlie Baker said the women’s basketball tournament alone was worth $65 million per year, or around 57% of Disney’s total annual payment of $115 million.

What a difference a few years makes. In 2016, Baker’s predecessor, Mark Emmert, revealed that while the men’s hoops tourney was the only postseason event that makes the NCAA money, “women’s basketball loses $14 million by itself.” Emmert may have been better served if he’d asked one of Disney’s ad sales execs to help sort things out on the cash-generation front; per media agency estimates, last year’s women’s basketball tourney generated some $19.4 million in advertising revenue for the ESPN networks and their broadcast sibling, ABC.

Since Emmert offered his doomsaying assessment eight years ago, fans have collectively turned that interpretation on its ear. Despite the 17-point margin of victory rung up by Kim Mulkey’s Tigers, last year’s LSU-Iowa final served up a record 9.92 million viewers across ABC and ESPN2, with the audience peaking at 12.6 million.

To better put those deliveries in perspective, the only broadcast primetime series to put up bigger numbers during the 2022-23 TV season was the venerable CBS newsmagazine 60 Minutes, which on seven occasions topped Disney’s Tigers-Hawkeyes turnout. Six of those episodes aired out of a national NFL lead-in.

If the Nielsen data wasn’t sufficient proof that something significant was happening in and around the women’s game, the ad loads suggested that marketers had finally started wrapping their heads around the inherent opportunities of the other March Madness. Advertisers may once have been susceptible to all sorts of erroneous assumptions about the women’s basketball audience, but they’d clearly seen the light by the time last year’s tourney tipped off on the Ides of March. The top spenders were all but indistinguishable from the backers of the men’s tournament, as blue chippers such as Buick, Nissan, AT&T, Capital One and State Farm generated some 3.5 billion ad impressions among fans in the adults 18-49 demo.

In fact, males in the dollar demo overshadowed those on the other side of the gender divide, as ABC’s broadcast of the title tilt posted a 26.6 share among men 18-49, versus a 21.8 share for women in the same age group.

Given the year Iowa’s Caitlin Clark has been having—perhaps you’ve heard of her—it’s little wonder that Disney is all but sold out of in-game inventory as it heads into the women’s tourney. Clark, who earlier this month broke “Pistol” Pete Maravich’s all-time NCAA scoring record, is officially the most well-known college basketball player in the country, according to a new Seton Hall Sports Poll. Among sports-media circles, some pundits are now convinced that the women’s bracket will outdraw the men’s event—although that scenario is only likely to play out if Iowa can book a return ticket to the final. Currently listed at +550 odds for winning the whole thing, Clark & Co. are Vegas’ second favorite contender behind an undefeated South Carolina squad (-140).

The intrigue around Clark—and a possible Elite Eight run-in with Iowa’s nemeses from Baton Rouge—has helped boost pricing and dollar volume. Buyers surveyed said they wouldn’t be surprised if Disney generated more than $25 million in ad sales revenue this time around, although hype is only part of what’s been driving a very brisk business. The sheer volume of first-time advertisers is a function of the growth of women’s hoops, as a roster of 42 newcomers has signed on. Among the clients taking their first plunge into the tourney are Google, Adidas, Home Depot and Honda.

This year’s sales effort extends well beyond the “spots and dots” that make up the traditional TV ad slate. Disney’s advanced advertising platforms and programmatic buying interface allow marketers to target the highly sought-after college hoops audience across the company’s entire portfolio of linear TV and streaming outlets, thereby increasing the value of their sports buys.

The Mouse House’s proprietary data makes all the difference; while many March Madness fans may be harder to pin down once the confetti starts flying on April 7, Disney’s unparalleled ability to reconnect with these same consumers by way of, say, FX’s American Horror Story franchise or Hulu’s original series The Bear takes all the guess work out of maintaining a connection with an audience that otherwise can be hard to track after the tournament ends.

“As the sports marketplace becomes more and more competitive, our ability to reach our audiences is really unrivaled,” said Jacqueline Dobies, VP, revenue and yield management at Disney Advertising. “We are no longer in a copy-and-paste RFP world. Advertisers are truly looking to reach specific audiences in unique ways, and we can do that better than anyone else in the business.”

Another aspect of Disney’s data-driven approach to serving its advertisers plays off of the unpredictable, edge-of-your-seat experience that has become synonymous with sports. (Not for nothing is “March” paired off with the alliterative modifier “Madness.”)

“It’s that ability to capture moments that you can’t plan for,” Disney VP of programmatic sales Matt Barnes said. “Think about how sports unfolds, and how overtime or buzzer-beaters will coincide with sudden surges and spikes in traffic. With programmatic, clients have an ability to capitalize on those surges around those moments you can’t plan for. When a brand has the ability to activate in real time around a moment where everyone is riveted to their screen, that’s a lightning-in-a-bottle thing that everyone is looking for.”

Once the province of social-media marketing, the opportunity to react to the action on the court or the playing field in real-time is now available to advertisers that buy across Disney’s streaming platforms. If Clark or South Carolina’s Te-Hina Paopao sinks a winning trey as the clock runs out, a watchmaker might look to play off the time-defying moment with a 15- or 30-second spot that drops almost immediately after the ball passes through the net.  

“Outside of social, this kind of thing has never been done before,” Barnes said. “But between our capacity for automation and our innate understanding of our audiences, advertisers are now able to take those moments and activate against them”—while the fans are still clutching their skulls.

Beyond the obvious advantages of being synonymous with sports, Disney’s innovation goes a long way toward explaining why the company has been able to weather a rather grim TV ad market. In a period that saw overall network cable sales plunge 15% for a loss of $670 million, Disney’s cable sales dipped 5% in the Oct. 1 to Dec. 31 quarter. Disney, which accounts for 29% of the overall U.S. cable ad spend, is on pace to generate $3.58 billion in ad revenue this year, flat versus 2023—this despite a projected 9% decline across the cable universe.

At the same time, the ESPN unit is expected to scare up $17.6 billion in overall revenue, a tally that MoffettNathanson expects to jump to $19.3 billion by 2027.

Meanwhile, for more traditionally minded advertisers who’d just like to get in on the next big thing, the March Madness TV window is about to slam shut.

“We are very well sold,” Dobies said. “It has been difficult to hold back inventory for scatter, because the demand coming out of the upfront and early on in the season was extremely strong. So we don’t expect the few units that are still available will last much longer, especially as the buzz around the tournament continues to build.”