It’s that time of year again: the upfronts, when the large (and small) television network companies rent out theatres, ballrooms and stages across Manhattan to pitch their upcoming shows, stars and research data to thousands of TV ad media buyers.
This kicks off what will be several months of negotiating tens of billions of “upfront” purchases of TV and video ad inventory for the second half of this year and the first half of next year.
Many people wonder why it still happens every year, much as it has for past decades. Many have already foretold its demise and – and been wrong – for many years. I for one believe that we still need the upfront in 2019.
Here are just a few of my reasons why:
People are still watching TV, and they’re not just folks ’65 to dead’. Events drives news and news captures attention. In an industry very focused on the latest and greatest new, shiny object, many folks forget the vast majority of Americans (even millennials) watch quite a bit of it every day.
The upfronts are heavily reported in business and trade publications that are read by folks in the industry, who are then reminded of the power and reach of TV.
Things change year over year in the TV advertising world. Last year at the upfronts, the merger of Discovery and Scripps Networks was less than two weeks old. This year, just days ago, Discovery’s CEO David Zaslav and chief advertising sales officer Jon Steinlauf were able to introduce a theatre packed full of ad buyers to a new, fully integrated Discovery with the kind of audience and content scale that used to only live within the big broadcast companies like NBCU or Fox. Both buyers and sellers need moments in time and stages to update everyone else on what’s happened from one year to the next.
TV advertising is a futures market. In the world of TV advertising, particularly when it comes to the most popular networks and the most popular dayparts – think prime time – demand exceeds supply. When that happens, owners of the highly sought-after demand are in a great position to auction off their future supply in an auction that will help them lock in sales, price and certainty as efficiently as possible. As long as the demand/supply imbalance exists, buyers and sellers both will want to do upfront buying.
Everyone loves a great party. Face it. Upfronts are great parties, and everyone in the ad, marketing and media world loves parties. Upfronts are typically staged in beautiful and cool venues with lots of great food, wine and drinks. There is a tightly managed invite list, so you feel exclusive and special. You usually get fun tchotchkes, like when A&E gave out really nice speaker bars and Discovery gave out super-soft and snuggly stuffed wild animals. Plus, you get to mingle with real-life stars, and can post selfies to reinforce how fortunate you felt to be there.
OK, maybe I haven’t convinced you. Maybe you believe that data, science, software and automated real-time bidding are going to replace the TV upfronts any day now.
Maybe you’re right! I do believe that technology is going to radically transform how our industry operates and how it buys, sells, measures, optimises and transacts on all video advertising, including TV.
However, even after that happens, I’m going to bet that the upfronts will still be here. What do you think?
Dave Morgan, a lawyer by training, is the CEO and founder of Simulmedia. He previously founded and ran both TACODA, Inc, an online advertising company that pioneered behavioural online marketing and was acquired by AOL in 2007 for $275 million, and Real Media, Inc, one of the world’s first ad serving and online ad network companies and a predecessor to 24/7 Real Media (TFSM), which was later sold to WPP for $649 million. Follow him on Twitter @davemorgannyc
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