Commentary
Will The Coronavirus Finally Make The Upfronts Go Away?
- by Maarten Albarda , Featured Contributor, March 6, 2020
You know the meaning of “the tail is wagging the dog,” right? That would be a good descriptor for the role the upfronts have played in the development of the marketing calendar.
For years, I have looked in bewilderment at the annual ritual dance that is the upfronts. Don’t get me wrong, I understand that TV networks, and later cable networks, wanted to create a stage where advertisers could sample the new wares, so to speak.
And it was inevitable that digital content platforms followed that model with their stupidly named “Newfronts.” Why stupidly? Because the “new” in Newfronts referenced the fact that this was content distributed through the once new platform of digital media. But we have had about 20 years of digital advertising by now, so there is nothing new about this today.
That was just a side rant. The main issue is that, while it makes sense for content providers to create an opportunity for advertisers to learn they can potentially buy ads around various content offerings, to couple that in this day and age to long-term commitments is not smart.
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Who can predict the future? Who can safely say what content is going to build a great audience, and what content is going to die the quiet death that most new content does? Most new TV shows fail. For every successful podcast , there are 1,000s with minuscule audiences. Most digital content does not reach millions, or even thousands. Placing long-term bets on content in today’s “here today, gone tomorrow” world is a bad idea.
And there is a second side effect that the upfront tyranny has created: Many advertisers force themselves through a strategy and budget-setting process to have said strategy and budgets approved in time for the upfronts. And that leads to all sorts of unintended consequences that, again, in today’s ever-changing world, are probably not helpful anymore.
Marketers obviously need long-term plans. But I would venture that they do not need to determine that 500 spots on “NCIS” is going to make or break those plans a full year in advance. If you are an Olympic sponsor (or NFL, or Oscars, etc.), you will have secured presence in those platforms through your sponsorship, so no upfront needed for that, either.
When developing their investment strategy, marketers need to know, in advance, what the next calendar year is supposed to deliver, what funds they have available to do so, and what initiatives are going to help deliver against those business objectives. Exactly what mix of TV and digital content options is going to deliver that is not yet a relevant question to answer.
But now we hear that many content providers, from TV to “newfront,” are canceling their upfront meetings for fear of the coronavirus. If most or all upfront events are canned, perhaps advertisers will realize they don’t need those events to begin with. All they need is a link from each content provider to a collection of trailers so they know what content might be worth considering in the future.
And those advertisers that enjoy gambling with their budgets can place long-term bets as part of the online process. For most others, advertising placement strategies can be made closer to when they are needed.
Now that would truly be a newfront way of thinking.
Maarten, there is a lot more to the upfront time buying system than you give it credit for. From the advertisers' point of view it gives them the certainty that they can promote their brands at various points during an upcoming season using the kinds of fare they wish to be associated with at specific points during the year---as opposed to taking pot luck in the scatter markets. Also, almost no advertiser buys a single show---instead most buys involve many programs on each network and many specific air dates---which mitigates any risks regarding making estimates of the ratings for new shows. The whole bundle of placements---not individula placements---is guaranteed audience ( GRP )-wise. Aslo, it is traditional for many advertisers to promote their upfront buys to "the trade"---their sales forces, distributors, store chains, dealerships, franchisees, etc. well in advance, touting their "sponsorship" of the "big time" network programs. This makes a huge impression on "the trade" which, otherwise has no idea what the audience levels of such shows are but is impressed by the "support" they are receiving . Last, but not least, while there are variations by season, generally speaking upfront CPMs are as favorable or better than those available in scatter so at least you know where you stand for an upcoming season re the upfront portion of your national TV buy and can approach the quarterly scatter markets more confidently--as opposed to being in perpetual fear of not getting what you need at a good price.
All of this said, I believe that the advertisers and sellers should consider a two-upfront approach. One, would be for individual brands and would use brand-specific targeting metrics as well as advanced methods to allow the brands the freedom they need to buy TV time that fits their needs. But they would, no doubt, pay more per set of "eyeballs". The second upfront would accomodate the CPM, audience tonnage, fixated advertisers who pool all of their brand budgets into a single massive, corporate buy---to intimidate" the sellers----or so they think. Here, brand by brand targeting is simply impossible but the trade-off is lower CPMs. Once such a system was started, brands could decide to go either way or split their buys so they utilize both types of upfronts. And the sellers would probably make out better in terms of ad revenues if the first upfront---the brand-specific one---attained scale as it would yield significantly higher CPMs.