Its new estimates project the 2020-21 upfront marketplace for broadcast and cable TV networks will total $14.78 billion, down from its previous estimate last year of $21.64 billion.
eMarketer also revised its 2019-20 upfront estimate down slightly, and its 2021-22 upfront forecast down significantly.
It cited a variety of factors, especially the "broader economic difficulties," as well as "content production stoppages and uncertainty around when live sports will return make it unclear what programs TV advertisements might appear this fall."
The forecast comes as the ad industry has called for permanently shifting the overall cycle of the network upfront marketplace from its traditional broadcast year buys (fourth quarter through third quarter) to delayed calendar year marketplace covering the first quarter through fourth quarter of each year, mainly to align the commitments to better timing for understanding what marketer's budgets and needs actually are.
Joe, I'm not so sure that the advertising agencies as well as many advertisers are fully in line with the ANA's call to improve the upfront process------or shifting to a calendar year. I suspect that we will probably return to a fall-summer "season" for upfront buys in 2021 and that this year is simply an abberation. As for improving the process---which usually refers to better targeting methods----this is not going to happen at scale until advertisers free their brands from their "corporate" time buys. At this point, there is little movement along these lines----but, one can always hope that client CMOs will finally come to their senses and understand that creative isn't the whole ball game, hence that audience tonnage and lower CPMs aren't the only things that matter. More importantly, they---the CMOs as well as brand managers----must get more involved in media planning and the time buying process---if they really want to see improvements---it's silly to expect the time buyers and network time sellers to do this for them.
I think a bigger impact that isnt being addressed (as awlays) is the localization of budgets. Brands are starting to undersatnd wthat with better knowledge of thier audience, not every message fits a national audience. As budgets return, I think we'll continue to see a decline in tradtional upfronts and network budgets and an increase in spot markets and variable creative to fit the regional audience better. Not every brand is a multi-million network branding campaign.
Eric, I seriously doubt that there will be a significant switch of TV ad dollars by national brands to spot TV. In fact, spot TV's mix of national vs local/regional ad dollars has been steadily swinging away from national brand buys and more to local/regional. There are many reasons for this but the primary ones are that many national brands never developed a market by market advertising or promotional strategy. Instead, many leave this up to the local store chains, franchisees, etc. and focus on their national ads to motivate purchase decisions on an umbrella basis. Also, many heavy up tests in supposedly key sales areas or markets---based either on BDI's - brand development indices--- or CDIs-category development indicies---- have not been effective. The extra GRP weight that was intended to increase local sales were largely redundent and their ROI didn't prove out.
For over forty years national advertisers and, mostly, their agencies have been pitched on the idea that they should start with local market planning---a plan for each city---then work up to a national network overlay. Everyone says that this is an interesting idea---but, so far, nothing has happened. More likely is the continued and gradual migration of national "linear TV" ad dollars to other national TV venues like AVOD and CTV as well as improved methods of targeting for "linear TV"---in this case via "addressable TV" and/or "advanced TV". But even this will be a slow process not a massive and suddden across-the board--movement.