CMO Series - State of the Media: The Upfronts Are Upon Us

By: Allen Ginsberg  | 05/29/2019

Introducing our new CMO blog series! What does this series entail? We're glad you asked! In this series, guest blogger and former BBDO Media Director Allen Ginsberg will discuss industry highlights, trends and thoughts on the current and future state of the digital marketplace from a senior perspective. Allen has had a long consulting career in the financial services and healthcare industries,​ and we're excited to learn from him. Take it away Allen!


It’s officially upfront season! If you’re not in the TV business, you’re probably asking, ‘What the heck is an upfront?’ But upfronts — the time each year when major networks gather to preview their upcoming shows for ad buyers ­— are more than insider presentations. They’re also an important barometer for both media costs and inflation, and continue to inform the state of the media. 

Open season for TV advertisers

With 23 different media companies holding court in NYC this spring, the TV and digital upfronts are with us again. This marks the traditional opening of media upfront selling season. 

Hundreds of marketers are lining up to commit billions of dollars to buy programs and demographics that will never see the light of day. More than 500 scripted TV shows are expected to air in the upcoming season, and many series will last less than a full 20 episodes. In fact, many streaming services order as few as six episodes for a series. Fewer than 50 percent of shows last into a second season. But the show goes on.

The largest agencies will commit over 20 billion dollars for the upcoming media season. What are their motivations? Many marketers are afraid of missing out on the small number of programming hits. They may also fear losing their jobs because of the perception that they aren’t keeping up with other “smart marketers” in the industry (FOMO is not new!).


It’s a confusing new world

Disney has just taken control of Hulu. YouTube has created a generation of new stars. AT&T now owns Turner and its collection of networks, esports and various streaming services, as well as the video streaming company Xandr. Disney recently purchased most of Fox, and part of Fox is still a stand-alone company — at least as long as it continues to produce The Simpsons (30 seasons and counting). Netflix is spending billions on content. Walmart is pushing to get into the streaming and advertising business. Oh, and let’s not forget about Amazon Prime.

But what shows are consumers watching? The top show on Netflix is “The Office,” a 20-year-old comedy series, with “Friends”, a similar vintage comedy, trailing right behind. These syndicated shows are worth hundreds of millions of dollars to the studios, but where will growth come from as the era of well-known, highly rated shows continues to decline?

NBC, the No. 1 network for adults ages 18-49 in 2018, was down 29 percent in primetime ratings for the first 10 weeks of the current season. And that’s assuming we believe that viewers don’t fast-forward through the commercials when they play back recorded shows. For the four major television broadcasters, the number of primetime viewers ages 18-49 (the age group that advertisers prize most) dropped 38 percent this season from five years ago.

Where else can you lose 30 percent or more of your business and still have people lined up at your door to commit for another year? Caveat emptor to all those lined up to spend.


The future of TV

Sports have become the new cornerstone of television programming. The NFL came back strong in 2018 and continues to be the only consistent ratings winner ­— along with news — that consumers come back to and watch live. The tech companies have gone along and teamed up with traditional networks to land the ever-increasing rights fees paid for sports. Both Amazon and Twitter now have TV deals with the NFL. 

Meanwhile, while magazines and other print media continue to decline, publishers are finally figuring out how to put video before print. Conde Nast recently presented its upfront schedule, which included an announcement of their new digital video pilots, and lineup specifically designed for the next generation. Meredith Corp. and The New York Times are each producing their own streaming services.

So, there you have it: The state of the media continues to ebb and flow. Is it confusing? Absolutely. Is it going to get easier for marketers? Not a chance…


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