Scatter TV Ad Demand Slows, Raising Upfront Demand Concerns

Near-term TV advertising demand for some TV network inventory is dropping in March/April due to COVID-19 issues, according to media executives who spoke with Television News Daily.

Planned network TV media dollars for major brand marketers are shifting to what is hoped to be more normal viewing periods in later months.

“We are going to be suspending [buying] for a couple of weeks to understand what our clients' marketing needs are,” says Gibbs Haljun, managing director for media investment for GroupM.

Another senior TV media agency executive says: “April is empty. May/June is the landing spot for now.”

Pricing may be affected. “We will definitely see a change in the supply/demand dynamics short term, and are working to better understand the longer-term implications,” says Michael Law, president of Dentsu Aegis Network’s Amplifi USA.

Media executives also say while network scatter pricing is down from previous scatter periods, it is still up over upfront deals made last June/July. 
Though network sources say many ad categories have declined — travel, retail, and restaurants — there has been increased spending from pharmaceutical, consumer products, and financial/insurance marketers.



TV networks have seen major inventory and pricing volatility recently due to COVID-19 issues -- especially with the suspension of the NBA, NHL, and early season Major League Baseball now made worse by the postponement of the Tokyo Summer Olympics Games.

All this has made premium TV network ratings points tougher to secure by marketers. Executives are concerned that issues around COVID-19 will continue to cause disruption, affecting the TV upfront advertising market set to start in June.

Haljun says: “If this goes anything farther than Easter, then we are pushing it -- the upfront will be delayed in the normal course of business.” Another executive is more blunt: “We may not see a traditional upfront this year.”

Generally, softer pricing over the next number of quarters -- coming from weak TV advertising demand -- could mean little urgency for marketers to make long-term inventory deals throughout a traditional September-May TV season.

Media analysts also note that current national TV network pricing for direct-response advertising inventory has been declining over the last several weeks.

NBC, CBS, and ABC representatives did not respond by press time to marketplace inquiries by Television News Daily.

Complicating this market is the postponement of the Tokyo Olympics event -- originally scheduled for late July of this year -- until 2021.  Earlier this month, NBC said advertisers already committed to buying $1.25 billion in inventory.

An NBCU spokesperson now says: “NBCUniversal is actively working with our advertising partners to navigate this postponement, and we’re exploring all options to best serve their brands and our consumers this year, and into 2021.”

Fred Chasse, senior vp of global analytics firm Analytic Partners, tells Television News Daily“This is a big deal for advertising because it represents over $1.2 billion in advertising. It’s going to be impossible for advertisers to take that Olympics money and spend it, last minute.”

Specifically, Chasse says big automotive Olympic marketers -- the likes of Toyota, Chevrolet, BMW, Ford and Honda  -- could be affected. “Those companies will take a good portion of those dollars and take it to the bottom line or put it towards more appropriate marketing for the economic conditions (such as promotions).”

Last week, data-based media technology company Tatari said, with regard to the current TV marketplace: “Fire sales are abundant and clients taking advantage of them are getting exposure to new audiences at a fraction of the cost.” It added that recently that “we secured an opportunity on a major network during primetime significantly below normal rate card.”

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