Fewer TV advertising dollars are expected to be spent in upfront deal-making in this year versus a year ago, according to a new survey from Advertiser Perceptions.
Just 49% of more than 300 U.S. marketers and agency executives in a February survey said they would be making upfront deals -- down from 56% a year ago -- when asked the question: “What percent of your total video advertising budget -- linear TV, CTV/streaming TV and digital video -- for this year will be allocated during the 2023 upfront negotiation period, and what percent will be reserved for the scatter market?”
Advertiser Perceptions concludes from these results: “Upfront spending will be softer in 2023.”
Of those who intend to place more dollars in an upfront deal than in the scatter market, 51% had an advertising spend of $25 million or more, and 43% had ad spend of less than $25 million.
Fifty-one percent said more of their national TV deals would be done through the scatter market. Fifty-seven percent of these marketers have less than a $25 million advertising spend, while 49% have more than a $25 million spend.
Of those making upfront TV buys, only 27% are planning increases compared to 2022. A year ago -- at around the same time -- 51% said they would be adding to their buys compared to 2021.
In addition, 29% of those making the media buys believe the average deal will be transacted using "alternative currencies" -- coming from 34% of media agency executives and 19% of marketing executives.
Digging deeper into data that connects directly to business outcomes, 54% of advertisers and agencies said the return on media investment will be the most important priority, with 47% saying they want more data-driven targeting capabilities.
Advertiser Perceptions also says that 55% of marketers want better campaign guarantees, with 34% of media agency executives citing this as a priority. In addition, 48% of media agency executives are focused on programming content, with 36% of marketers saying they want to focus their efforts in that area.
Advertisers expect 40% of their upfront buys to be on connected TV/streaming platforms.
Erin Firneno, vice president/business Intelligence, Advertiser Perceptions, says: “Amid economic uncertainty, advertisers want to keep ad investments more flexible and prioritize the channels that can demonstrate ROI.”
You can't mix "non-prime"---often short-duration ---- content as is often utilized in digital video buys with "prime " TV content---and get a meaningful fix on the coming upfront. Also you must separate local from national buys. How much of digital video is bought as part of the upfront? Not much. And the same point applies to CTV? How much is bought programmatically and by local advertisers? The real upfront, which includes spending in all dayparts in "linear TV" plus streaming buys placed on AVOD and FAST services will probably be higher---not lower ---than this season's totals. "Linear" may go down somewhat but streaming will, no doubt ,increase for an overall net gain.