Advertising: A Necessary Nuisance

A brief explanation on the economics of TV advertising.

Advertising: A Necessary Nuisance

Aidan Pollock, Contributor

Imagine you’re watching your favorite TV show, like Survivor, or The Voice. But then, right before the climax of the entire episode, it cuts to commercials. The feeling of irritation is so overwhelming that you are tempted to just turn off the TV, but you can’t bring yourself to do it because you need to know what happens next. That’s what I’m here to discuss: why advertising exists.

Advertising or commercial breaks exist because television channels desire to attain profit.  This means that if shows on a certain channel require more money to produce, then the profit margin would be smaller, thus increasing the demand for more commercials. Commercials are sold based on commercial slots. Basically, the channel would split up the channel’s programming so that there would be portions broken up, normally in between shows, or at natural transition points during the show. Those empty slots are then broken up into 15 to 45-second slots which are then sold off to the highest bidder. Each commercial slot gains an initial cost based on certain viewer conditions, such as how many people would be watching at that point in time, which is why Super Bowl commercials are so expensive.

So who’s to blame for the commercial break during most nail-biting moments during the show? Well, you’d be surprised, but the show itself is to blame. Why? Well, during that climactic moment of the show, the heights number of viewers would be viewing the moment, thusly becoming the most viewed portion of the show. That means, that if shows put room for commercial breaks, which allows for commercial slotting, then those slots would be worth more, and make it so that the show gets just a little bit more money from the ads.

Despite the irritation provided by commercial breaks in really crucial parts of the show, these ads are essential to the actual programming that is interrupted by the commercial. Without these ads, there really wouldn’t be anyone willing to run and manage television channels, and pay for the different shows. In fact, on average, the show “Survivor” makes approximately $73.1 million per season, while some other really popular shows, like “American Idol”, can make up to $260.7 million per season. This is a huge margin of profit that really is astonishing, and it helps improve the quality of the show. Why? Well, if a show on a Television channel, let’s say, Survivor on CBS, and the said show begins to gain profits for CBS because of an increase in show viewership, then there would be an increase in the shows spending budget, which in turn increases the quality of the programming.

So next time you feel irritated that your precious moment of sitting at the edge of your seat in anticipation was ruined by advertising, remember, that advertising is what allows the show to improve and grow.