Upfront: Trad TV Dollars Pivot Into Digital Channels
Some high-priced cable networks forced some traditional TV dollars into the hands of big digital video players this upfront.
Speaking at the OMMA Ad Nets conference on Monday, Donnie Williams, executive vice president, chief digital officer for independent media agency Horizon Media, estimates some clients shifted 8% to 13% more dollars into premium digital platforms during the recent upfront sales.
Williams did not mention specific cable networks or digital video platforms.
Many senior broadcast and cable network executives forecast -- and then claimed big CPM increases for this upfront period, anywhere from 11% to 13%. But Williams notes that some networks collapse from certain price points, where the CPM gap between cable and premium digital video sites closed significantly.
"Those [TV] guys drop their rates by an unbelievable amount," says Williams. "So if last year we were looking at CPMs in excess of $30 [for some demos], let's say they dropped their rates by 75%. It was a real land grab. As a result, tons of money went through our organization to digital channels."
How much money? A lot. "We were writing deals 8%, 12% to 13% -- that's the increase spend on premium digital channels," says Williams. More importantly, he adds: "We weren't taking a hit on rates."
Right now, Williams says, the marketplace for some specific premium digital video sites is solid. "There were guaranteed CPMs in the premium marketplace that sold for $10 -- that's guaranteed against audience," says Williams. These CPMs are for all viewers, persons 2 plus.
He notes that the future looks bright for some digital video players. "It's not going to be very long that dollars are going to be re-shuffled and people start to exhaust channels they feel are more in line with the offline [TV] channels they are purchasing."