Millions of Americans will spend Thursday morning watching the Macy’s Thanksgiving Day Parade, a majestic mix of balloons, floats, high school and college marching bands and big stars.
A tradition that started a century ago, the parade remains one of the few spectacles that still draws a big audience to broadcast television, with nearly 30 million people tuning in last year.
Airing it is about to get a lot more expensive, reports The Wall Street Journal.
NBC, which has had the broadcast rights since 1953, is trying to hammer down a new deal with Macy’s to keep the event on the network and its Peacock streaming service for the next decade, according to people familiar with the talks.
Under the terms being discussed, a new deal would kick in next year with an average annual fee of more than $60 million, up from around $20 million in the current contract, the people said.
The Thanksgiving Day parade is a slice of Americana—cartoon characters and commerce marching hand-in-hand from Central Park in New York City to Macy’s flagship store in Herald Square. The event celebrates both the spirit of the holiday and the Christmas shopping season that commences after the last piece of pumpkin pie has been devoured.
Last year, NBC took in $52 million in advertising for the parade, with the average commercial costing $865,000, according to Guideline, an advertising research and data firm. This year, the average price per spot is almost $900,000.
The cost of production, which NBC outsources, has increased from under $4 million a few years ago to close to $7 million for this year’s broadcast. A factor in the increase is higher celebrity appearance fees, which often run six figures.
The rising rights fees and growing production costs will likely reduce the profits the parade generates for NBC. Still, the event is too important as a lead-in to the rest of NBC’s Thanksgiving lineup to risk losing.
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