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MTV VMAs Set Sponsorship Record Despite 2012 Ratings Slump

This year's edition of the annual event has generated impressive ad revenue in part because of a partnership with Twitter's Amplify.

MTV New Moonman - P 2013

MTV’s Video Music Awards have had a roller-coaster couple of years in the ratings, from reaching all-time highs in 2011 thanks to Beyonce’s baby bump to a 50 percent plunge in 2012. Yet despite last year’s drop, this weekend’s show, broadcast from Brooklyn’s Barclays Center, has already set MTV sponsorship records.

“It’s the highest level of revenue we’ve ever produced for a show," says Jeff Lucas, head of sales for Viacom Media Networks’ Music & Entertainment, Advertising Sales & Marketing group, who also noted last year's impressive social media numbers as part of the reason behind this year's sponsorship gains.

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Building off the social media momentum of last year’s telecast, which generated some 15 million tweets, MTV was able to court even more ad dollars this year in part because of a new partnership with Twitter’s Amplify program. A social video product introduced earlier this year, Amplify will allow Pepsi, Degree, Cover Girl, Wrigley and Microsoft to enhance their VMA activity by sponsoring any video tweeted from an MTV-affiliated account with timely content.

So for example, if MTV tweets a clip from Katy Perry’s closing performance of “Roar,” Pepsi could sponsor that video as a promoted tweet to reach MTV’s followers based on users’ geography, operating system, device or publicly shared interests. Branding in the videos themselves can take the form of anything from a preroll, to a clickable overlay ad to a postroll ad, with ad lengths often varying from 3 to 5 seconds.

The VMAs are just one event in a planned series of over 40 Viacom programs that will offer Twitter Amplify to advertisers over the next 18 months. Glenn Brown, head of Twitter Amplify, started the program earlier this year to help timely properties in sports, news and publishing achieve better, targeted results for their clients. Early Amplify media partners include ESPN, NCAA March Madness and the NBA Finals, with sponsors like Coca-Cola, AT&T and Taco Bell.

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The Viacom deal marks Amplify’s 13th program so far. Brown cites an early program with ESPN as a benchmark -- through promoted tweets, sponsors saw their ads embedded into 7 million video views across 150 clips that received a total of 130 retweets. “We always get some great data behind each one to feed back into the system to make the programs even better,” he says. The Viacom pact will include more than 40 different TV properties, continuing with Comedy Central’s Roast of James Franco over Labor Day weekend.

The VMAs have become a nearly week-long celebration for MTV and its sponsor partners. Pre-VMA concerts in New York City have been running every night leading up to the show, with sponsorship from Pop Tarts (Hot Chelle Rae and Fifth Harmony), Windows Phone (Timeflies and Jason Derulo), Cover Girl (Ciara, Nervo and Becky G), Time Warner Cable (Robin Thicke, Mayer Hawthorne and Macklemore) and Taco Bell (The Neighbourhood, New Politics and Wildcat! Wildcat!) Getting an even earlier start, Verizon Wireless has been sponsoring a VMA Pop-Up Tour that started Aug. 10 in Williamsburg Park at the Mad Decent Block Party and will conclude this weekend with a Friday concert from Jake Miller at Rye Playland and a performance from Austin Mahone in Coney Island on Saturday.

Additionally, this year’s telecast will be live-streamed in its entirety for the first time, though the VMAs were among the first major awards shows to experiment with same-night online streaming as far back as 2006. Microsoft’s Windows Phone will sponsor an All Access page on MTV.com, featuring behind-the-scenes footage and a customizable video player to view the show from multiple camera angles.

MTV will also host an online GIFFY Awards created to animate GIFs based on the show's most dramatic and memorable moments. Windows also live-streamed its Wednesday night concert featuring Timeflies and Derulo.

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Other features will include a Social Radar, compiling activity from Twitter, Facebook, Instagram and Vine, and a real-time vote ticker for the Song of the Summer Award. “This year is kind of a manifestation of an evolution of the things we’ve done in the past as well as some of the new things we’ve added to the experience,” says Colin Helms, MTV’s senior vp digital media.

Billboard caught up with Viacom's Jeff Lucas to learn more about this year’s show and why the VMAs have become a disproportionately high priority among advertisers despite recent ratings hiccups.

Billboard: The VMAs is the first program of your multiyear deal with Twitter’s Amplify program. How will you utilize that?

Jeff Lucas: In the world of social media, the VMAs is our Super Bowl and even bigger in some ways. Even after all my years at NBC [running sales for cable, the Olympics and late night], Viacom gets the best talent at the best events I’ve ever seen. We have live events but we also have topical events, and we’re gonna build off of the VMAs. I know a lot of organizations have agreements with Twitter and do different things, but I think we are the best fit. It’s a great product to build off of, not just content. We have relevant content that we can customize. We can amplify this out into the Twittersphere. I would say this is the first-ever implementation of Twitter Amplify in an entertainment event.

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How is Twitter Amplify sold -- do you and Twitter go to market together?

It’s for on-air sponsors -- for us to do an Amplify deal, you have to be a conversion sponsor. We work very closely with Twitter. Adam Bain has a great sales force. We work very closely with them. We work with their data people. It makes a very strong team. The collaboration is very key here, and it will only work if you have trust, collaboration and a strong product. If you look at both of us, we have deep relationships with clients, proven relationships that have delivered great content before. So if you put the two of them together it’s a home run.

How does that net out in terms of revenue sharing -- does it require a 50-50 split between partners? Does that mean budgets are doubled so that everyone can hit their numbers?

What it requires is we’re all in it to deliver a great product, and to do that we each have a piece of the budget. I wouldn’t call it double the budget, I would say there’s a certain price on our side, and a certain price on their side. What it does do is allow us to tap into new buckets. We’re a broadcast entity that lives across all the screens, and what we’re able to do because most of our competition can’t, is tap into budgets that we haven’t before. If you’re going to make a mark in social media you need great content. And we’re bringing that together with our clients to bring specific reach to their followers.

How did last year’s ratings drop affect this year’s sponsorship sales?

Last year’s show, from a social point of view, was a huge success. And we’re sold out for the show this year. It’s the largest show we’ve ever had. The highest level of revenue we’ve ever produced for a show. Last year’s show was still the most social event, generating almost 15 million tweets, so from a social point of view it was our largest ever and grew from the year prior. And if you look at last year’s awards, we had 22 deep integrations with clients into the show. And clients who were very happy with having the ability to use customized content to reach that very special audience that the VMAs can deliver. They’re all back and want more of it. So you’ll see a lot of those main advertisers back with even deeper integrations this year.