Fox Offers On-Air Make Goods Online

Fox Broadcasting, desperate to provide ad time to compensate sponsors for ratings shortfalls this season, is floating a digital solution.

With the exception of CBS, all the major networks have missed some of their rating guarantees this fall, according to buyers, who say they have already demanded make goods from ABC, NBC and Fox.

And Fox, down nearly 20 percent among adults 18-49 so far, is deepest in the hole. Compounding the problem for the network: a lack of inventory with which to make good, given the network’s high upfront sellout level this year, coupled with an hour less inventory than the other networks to sell each night.

Fox’s new proposal is to offer for the first time ads in shows streamed online as make goods for on-air ratings deficiencies. According to sources, the network, realizing it would run short of on-air spots to make good, started approaching clients with the idea of accepting streamed ads to compensate for shortfalls in October.

If the proposal gains wide acceptance, it could save Fox from having to return cash to clients, always seen as a last resort for both sides. It could also help the network limit the number of premium ad units in franchises such as the National Football League that it needs to offer clients to make them whole. (Buyers say Fox has already used some NFL time for make goods this season).

Some clients have been receptive, buyers say. “It’s within the programming you’re buying on the network, so there’s an advantage there,” said the head buyer at one major New York-based media shop. One of the biggest gripes about make goods is that they are often put in replacement shows or other programs outside of the mix originally purchased by the client.

Another senior buyer said that most of the streams being offered for make goods are for the higher rated shows on the network’s roster, such as House, Glee and Family Guy, “so that chances are your mix of programs online may be better than on-air.” That’s because clients are often required to buy lower rated shows on the network for the opportunity to buy more popular programs.

Still, many clients haven’t decided whether they’ll take Fox up on its latest make good offer. “We’re looking at it now,” said one buyer, who indicated that Fox has requested that agencies and clients keep the proposal under wraps for now. Which probably explains why a network rep couldn’t come up with a comment Friday morning.