Advertisers love Oscar

This year, the advertisers are better known than the movies.

After being threatened by the Hollywood writers strike, the 80th Annual Academy Awards telecast will roll on Sunday with its customary glamour and coterie of stars. That’s a huge relief for Walt Disney Co.’s ABC television network, which had sold most of the show’s commercial time before November, when the strike began, for an average $1.8 million for each 30-second spot, an increase of nearly 6% from the previous year.

The Oscars are one of TV’s biggest events. It’s a favorite of advertisers, who plunk down millions of dollars to be associated with Hollywood -- even during a year like this one, when TV viewing levels are down and most people haven’t even seen the films that have been nominated for top honors.

Only “Juno,” the story of a pregnant teenager, has topped $100 million at the box office. The other films competing for best picture -- “No Country For Old Men,” “Atonement,” “Michael Clayton” and “There Will Be Blood” -- each have grossed less than $65 million in theaters.

“This year we don’t have ‘The Lord of the Rings’ or any other big blockbuster, nor do we have any great enthusiasm about the host Jon Stewart,” said Kelly O’Keefe, an advertising professor at Virginia Commonwealth University. “This seems to be a weak year for Hollywood movies.”

Still, advertisers and ABC are betting that the obscure films won’t diminish the appeal of the program or put a big dent in ratings. The show’s producers have added several crowd pleasers to the list of presenters, including Jack Nicholson and Miley Cyrus of Disney’s “Hannah Montana” fame.

“The show is bigger than the individual movie titles,” said Geri Wang, senior vice president for prime-time sales at ABC. “It’s larger than the sum of its parts. We believe there is a lot of pent-up demand for this program not only within the entertainment industry, but also among our viewers and advertisers.”

Over the years, viewership for the Academy Awards has fluctuated, reflecting competing news events as well as the popularity of the movies and stars who are vying to take home one of the gold statuettes.

The high-water mark was a decade ago, when more than 55 million people watched the night that “Titanic” swept with 11 Oscars, including Best Picture. The nadir came five years ago, when 33 million viewers tuned in to the broadcast that came two days after the U.S. invaded Iraq. ABC cut from the program to the late news anchor Peter Jennings, who gave somber updates on the war. The winner: the musical “Chicago,” which had generated only $65 million in ticket sales before it was nominated, even more than most of this year’s nominees.

Last year, when “The Departed” won Best Picture, 40.2 million people watched the show. Network executives are hoping that because the recent writers strike derailed Hollywood’s other prize fests, including the Golden Globes, there should be less “awards show fatigue” than in previous years.

“It’s a coming out party for Hollywood,” said Chris Jogis, vice president, U.S. brand development, MasterCard Worldwide. “There’s a pent-up demand among viewers who want to experience Hollywood again.”

What’s more: Even if the show posts lower ratings, it would not affect ABC, which makes about $10 million to $20 million a year in profit from the awards show. ABC does not provide ratings guarantees, which means that advertisers would not receive refunds or free commercial time if ratings fall short of projections.

“With live events, you pay your money and take your chances,” said Ryndee Carney, spokeswoman for General Motors Corp., which bought 3 1/2 minutes in this year’s show to promote its Cadillac, GMC and Saturn car lines. “But the Academy Awards are always a premier property. People love to tune in to see what people are wearing and who wins the awards.”

But the danger for ABC, however, is that if ratings are unusually low, the network will be in a weaker position to demand higher ad rates next year.

General Motors, MasterCard, American Express Co., JC Penney Co. Inc., Coca-Cola Co., Mars Inc.’s M&M; candies, McDonald’s Corp. and L’Oreal are among the advertisers who are returning to the red carpet again this year. And two advertisers, including Unilever’s Bertolli frozen foods, will make their first appearance during the Oscars.

Executives for those companies say the show, which typically ranks as the second most-watched event of the year after the Super Bowl, remains a magnet. That’s because nearly two-thirds of the TV audience are women, who often make household buying decisions.

Moreover, most viewers watch the show as it happens, rather than recording it to watch later on, because they don’t want to go to work the next day clueless about who won.

“It’s one of those rare telecasts that you have to see live,” said Kathy O’Brien, marketing director for Unilever’s Dove brand, which bought 90 seconds of time in the show for a live contest.

Viewers will be able to vote online and in real time for one of two commercials produced by amateurs. The winning ad will be shown during the Academy Awards.

MasterCard, American Express, JC Penney and Mars’ M&Ms; are also introducing new ads and marketing campaigns in the show. Like the Super Bowl, the Oscars has earned a reputation for being the place to unveil clever commercials.

“People are very focused on the entire show, including watching the commercials,” said Jogis of MasterCard , which is also using the awards show as a platform to launch a contest.

Another attraction for advertisers is the Academy Awards audience has a high concentration of affluent viewers.

“The show attracts people who are a little more upscale, and those who are paying more attention to the film industry rather than just going out to the movies to see ‘Rocky V,’ ” said O’Keefe of Virginia Commonwealth. “We have a very Hollywood-enamored society, and there is an elegance to the Oscars, the clothing and the runway show, that people pay attention to. That culture is very attractive to average consumers and even more attractive to upscale consumers.”

Advertisers dig the “cool” quotient.

“It’s a great association for advertisers, and this year, we don’t have any real political controversies that have kept some advertisers away in the past,” O’Keefe said. “The only thing that would have made it better would have been to have some really great films this year.”

--

meg.james@latimes.com